Preamble

Morning Sitting

MR. SPEAKER resumed the Chair at Ten o'clock a.m.

TRANSPORT BILL

[3RD ALLOTTED DAY]

Order for Third Reading read.

10.0 a.m.

The Minister of Transport (Mr. Richard Marsh): I have it in command from Her Majesty to tell the House that Her Majesty, having been informed of the purport of the Transport Bill, has consented to place her prerogative, so far as it is affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
I beg to move that the Bill be now read a Second time.—[Laughter.]—the Third time.
I thought it would be rather entertaining if we could start from the beginning again. I rather liked the phrase used about the Bill by The Times on Tuesday. The Times referred to the Bill as "Not a bad Monster".
We on this side of the House make no apologies for the size of the Bill. The size of the Bill merely reflects the size of the problem. In asking Parliament to face up to a problem of this size we were asking Parliament to tackle a heritage of neglect and incompetence for which hon. Members opposite must bear the blame.
When I came to the Ministry of Transport, it was interesting to see the way in which the discussion was going. One had read in the newspapers of the great passions which the Bill had evoked among hon. Members opposite and their desire to ensure that certain controversies within it should be fully debated, yet all the evidence of the Committee stage and the Report stage is that the whole thing became a somewhat "phoney" exercise.
The Bill is primarily concerned, not about nationalisation, nor is it about some deep plot by Whitehall to run all our buses or to do down the road haulage

industry. The Bill in fact has a number of objectives. One of its objectives is to realise the transport policy which this Government were elected to carry out, namely to provide Britain with an integrated transport system. But if integration is to be more than a political slogan we must do more than simply put together the assets and activities which previous Governments have torn asunder.
Throughout this Bill I distinguish two themes which we have sought to promote at every turn—managerial efficiency and the provision of right inventives for each industry with which we have had to deal. There is no point in going through every part of the Bill in detail. Indeed, it would be unfair to do so because I have already had to make my apologies to the hon. Member for Worcester (Mr. Peter Walker), who is to open for the Opposition, for the fact that I shall have to leave rapidly after my speech because there is another meeting in the precincts which I have to attend.
There is no point in going into detail, but I should like to demonstrate how these themes are picked up again and again in all the major provisions of the Bill. They have cropped up time and again in these long wearisome debates. The first part of the Bill deals with the National Freight Corporation. Here we do two things. We put an end to the quite pointless competition between British Rail and British Road Services for some of the same traffic. But we also provide a framework in which management will be subjected to the discipline of commercial profitability and this will also be the yardstick of its success.
I am convinced that the freight transport consumer—industry—stands to benefit enormously from integration in this field. Container traffics, for example, cry out for integration. It is rather strange that the Opposition should have resisted so fiercely the establishment of an organisation capable of maximising the economic benefits of modern transport technology. What amazes me is that even at this late stage they are incapable of realising the complete illogicality in the modern world of having two quite separate sectors of the same industry.
The proposals for passenger transport authorities are a similar measure of integration. The Bill creates the framework


in which local authorities individually and together can set out to solve the traffic and transport problems of the 1970s. Of course there are differences of view about the P.T.A.s and how they should operate, but I am convinced that local authorities will welcome them because they will see that here is an instrument which they can use effectively. The authority will set the general lines of policy and the Executive will translate that policy into action, and the Executive will be working under a clear financial directive.
Of course hon. Members opposite have invented a double bogey with which to try to scare—I must confess with some success—various sections of the community. They have gone busily around the country saying that there will be swingeing increases in the rates because the P.T.A.s will be responsible for local suburban rail services, but they have ignored the fact that the Government are to give generous help with the cost of these services. They also ignore the fact that the P.T.A.s, through their wide new powers to plan and develop passenger transport with the aid of Government grants, will be in a far better position to run viable transport systems than the existing authorities.
The basic point here is that whether a suburban railway line should be kept open when it is unprofitable is properly a local decision, but those who take such a decision should take it in the light of the financial responsibility which goes with it. With all the criticisms we heard about lack of financial discipline in the public sector I should have thought that this would be particularly popular with hon. Members opposite.
Of course the biggest problem which has cropped up and the major sector of the Bill has been on the question of the railways. It has been suggested that this is basically a Bill for feather-bedding the railway system largely because of the plan for quantity licensing of road haulage. If ever there has been a piece of legislation or a part of a Bill which has been exaggerated as to its effects this has been deliberately whipped up by hon. Member opposite to such an extent that one feels that they do not even understand it themselves. A large section of the country does not understand it because, indeed, the controversy about quantity

licensing—[Interruption.] It is not a question of knowing the Bill. It is a fact that a large amount of the—[Interruption.]

Mr. Speaker: Order. The Front Benches must restrain themselves a little.

Mr. Marsh: Hon. Members opposite tend to get whipped up in this way because they have got into the habit of doing it. They have been in this hysterical way ever since this issue came before the Committee. As a result there is undoubtedly a great deal of fear in the industry about the proposals for quantity licensing which is totally unjustified by the facts about the provisions. If one takes together the natural market attraction of freightliners and the Bill's provisions as to quantity licensing, the combined effect will be to shift not more than 10 per cent. of the existing freight off road on to rail over the next eight or nine years. To suggest that that is a serious threat to the road haulage industry is nonsensical.
On the commercial criteria there can and will be no question of moving goods from road to rail if that means that they will be carried less efficiently. The whole question of quantity licensing has been deliberately inflated out of all recognition. It is very interesting indeed to see that when this issue came before the Committee and then before the House on Report, although hon. Members opposite expressed themselves as deeply moved by the wickedness of this proposal, the vast bulk of the Amendments were pretty frivolous ones. [Interruption.] I can only say to hon. Members opposite that when one reads the debates, as we have done, and when one has had the misfortune of sitting through some of them, one knows that we have had the same Amendments on the same issues.

Mr. Speaker: Order. We cannot debate Amendments on Third Reading.

Mr. Marsh: That is perfectly fair and I apologise, Mr. Speaker. Quantity licensing will apply only to the heaviest lorries. At one stroke nearly a million light vans will be rid of the need for carriers' licences altogether and quality licensing will mean tighter controls on safety for over half a million heavier vehicles.
It is said that the Bill feather-beds the railways by relieving them of an intolerable debt burden. For the first time in their history the railways will have an effective, firm, but severe financial discipline imposed upon them. They have been in severe financial trouble for a very long time under Governments of both parties. Much of the cause of this has been the social burden they have had to carry. Despite massive investment—more than £100 million a year since the mid-1950s, the railways deficit is in my view and that of my right hon. and hon. Friends completely out of hand. It is absurd to expect an industry to respond in terms of good management and morale with a deficit that no one believes can ever be wiped off in the normal way. The Opposition met this problem in 1962 and tinkered around with it. They suspended over half the debt which we are abolishing. That was a failure to face the facts. That debt could never be reasonably expected to bear interest and should have been eliminated long ago.
It is said that cancelling the debt is subsidising the railways under another name. That is not so. The capital value is determined by estimating the future profitability which we should get from the industry, given good management, and we have good managers there.
That is what the Government are trying to do for the railways. There are social services in our economic structure and there are economic services, and there is no reason why a publicly-owned industry as such should carry social costs. If a publicly-owned industry is desired to carry a social obligation, the Government should meet the cost, as we are doing under the Bill. For the rest, the job of the railways is to function on commercial criteria, and they must be run as a national business, and as an efficient business. No one should underestimate the difficulty of the task which faces the railways at present, and I do not think that anybody on this side of the House does so.
There will inevitably be further declines in their traditional freight traffic. They need to pursue a vigorous, flexible and very strong marketing policy. That is why the Government welcome the

report of the National Board for Prices and Incomes published today, and accept its recommendations.
In particular, we agree that if the Railways Board is to fulfil its new financial remit market pricing must be the backbone of its pricing policy. This is already the practice over large parts of the freight services of British Rail, and the Government have therefore accepted the recommendation that there should be no general increase for freight charges but that the Railways Board should continue to negotiate individual contracts against the background of its new tough commercial remit, so as to increase its net revenue as much as it can in its competitive environment. The Government will be consulted by the Board about any price increases in 1969 which would be likely to have a general and significant effect on industrial costs.
Market pricing will be a new departure in the passenger field where the basic fares are still fixed on a standard mileage scale. It is right that the railways should get away from this and relate their charges to what their services can legitimately earn. There is no reason why the services should not be priced on the basis of what the market will bear. British Railways will now be working on this, and individual passenger fares, both first- and second-class, will doubtless be increased by varying amounts in the coming months.
The Report approves the proposals for percentage increases in the parcels and sundries scales. These will be adjusted by the Railways Board as quickly as possible.
In view of timetable difficulties relating to the Transport Tribunal's procedures, I have already authorised the Railways Board to submit a formal application to the Tribunal for percentage fare increases in the London area to keep them in line with London Transport, as recommended in the Report.
The reference to the Prices and Incomes Board last October necessarily precluded increases in charges which would have brought British Railways in at least an additional £1 million a month. But the reference has probably been of public advantage in that it should now lead to British Railways' charging policies being put on a sounder basis for the


future. From the beginning of next year, as a result of the Bill, British Railways will be on their own.

Mr. Peter Walker: Does the Report contain any sort of general percentage overall increase which it is expected will have to be obtained, say, on the passenger side?

Mr. Marsh: The intention is that the Board should examine its passenger charges, that it should do a marketing costing and then proceed to submit separately proposals for specific increases based on what the market will bear, with the assumption that there will be a limit on the second-class fares and none on the first-class fares.
In due course we shall have to fix a new target for the Railways Board along the lines set out in the White Paper, Nationalised Industries: A Review of Economic and Financial Objectives. It will not be sufficient for the Railways Board merely to break even. It will be required to build up a general reserve, a duty which was temporarily suspended under the 1962 Act. This is essential if the Board is to put itself in a viable position, able to face with confidence the difficulties and uncertainties of the next few years. If in any year it fails to break even, there will in future be no deficit grant from the Government. I can assure hon. Members opposite that all the talk about feather-bedding sounds pretty hollow to the management of British Railways at present. It is only too conscious that it faces a very difficult and tough task. It consists of men devoted to a publicly-owned industry, and it is a source of some sadness that throughout our debates there has been constant sniping and sneering attacks on every one of the publicly-owned industries. These people have a real and tough job to do and are entitled to the support of the whole House in doing it.
But it has been pretty clear that the debates have not really been concerned with setting proper incentives for nationalised industries or enabling management in them to do a proper managerial job. One of the most controversial Clauses in the Bill was Clause 45, which gives the workshops of the nationalised industries freedom to enter the general market. Then we heard the

apostles of competition insisting that the publicly-owned industries should not be a charge on the taxpayer. "We believe in competition," they say, but let a nationalised industry enter into competition with the private sector, let it maximise the use of publicly-owned assets within that industry and the screaming we hear from hon. Members opposite, and have heard all the way through the consideration of the Bill, is very loud. Why they have such lack of confidence in the ability of the private sector to compete, I do not know. They say that the nationalised industries must not be subsidised. Of course, they must not. I accept that. I do not think that they should be, but if they are not to be subsidised they must be able to manage their businesses with the same freedom as any other competitive commercial body. One cannot do it by placing shackles on the nationalised industries' commercial freedom of action which would never be placed on any private industry.

Mr. Michael Heseltine: Does the Minister accept that one cannot do it unless one takes account of the market value of the capital employed in the nationalised industries as a whole?

Mr. Marsh: Over and over again we hear the old story. We had it at great length and when the arguments were put on Report they were no more convincing than they were in Committee.

Mr. Speaker: Order. We must not drift. We can discuss only what is in the Bill. That Amendment was out, I think.

Mr. Marsh: I know, Mr. Speaker. Hon. Members opposite keep doing it.
This has been the Opposition's policy for public enterprise throughout, and then they have the gall to complain if a publicly-owned industry fails to make a profit.
We make no secret, and do not apologise for the fact, that this is a Bill to reorganise transport. It is a big, comprehensive Bill, but one cannot reorganise transport in this country except on a comprehensive scale, which involves a very large Bill. The problem we faced over a long period was the failure to recognise the one basic point that one cannot separate the separate sectors of transport and have a transport policy.
Inevitably, there has been a great deal of heat in the debate. Many of the arguments turned not on the individual issues in the Bill but alleged abuse by the Government of Parliamentary procedure. The only people who have shown anything less than respect for the rights of the House are hon. Members opposite. They complained that proposals for quantity licensing were not properly discussed in Committee. Of 11 Clauses dealing with quantity licensing, only the first, Clause 67, was debated in Committee. That was because the Opposition insisted on having eight separate debates on different kinds of traffic which they wanted to exempt from quantity licensing. They insisted on this despite the clear and repeated statements that the Government would consider the case for exemptions under the regulations.
We put forward the proposition that the eight Amendments should be taken together, but we had to have eight separate debates on that one Clause when one would have sufficed. We had to sit through those debates, hearing my hon. Friend the Minister of State referring back to the remarks he had made on the first Amendment in discussion of every succeeding Amendment of the eight. It was the same debate over and over again. That sort of thing makes a mockery of the procedures of the House.
Then we had the Amendments moved by the Government on Report. There has been a lot of comment in the Press and on the Floor of the House about this. I would be interested to know what exactly it is expected that a Minister in a Standing Committee should do if it is not to listen to debates and put down Amendments in the light of what emerges. As far as I can see, if I and my right hon. Friend before me had ignored every word said in Committee— and there was a certain temptation to ignore some—everything would have been all right, but because we listened to what was said and tried to meet the points made—because there is no absolute wisdom on either side about this— and then put down Amendments, we are criticised.
What about all this trouble over the Amendments which the Government put down? We introduced 192 Amendments and four new Clauses. Of these, 53 were

substantive and the rest were purely consequential on the 53. Of the 53, no less than 44 were in direct response to points made in Committee. Only nine new points were originated by the Government on Report.
The Opposition cannot have it both ways. If the Committee procedure means anything and we do not waste our time here, it is the job of the Government to listen and, in response, to put down Amendments to a large Bill on Report. If that is not what is wanted, it places Ministers on future occasions in a genuine dilemma at the beginning of a Bill, because if the extent to which a Minister responds to a Committee is in direct ratio to the amount of hostility which seems to be generated in both Houses and in the Press, the option seems clear. Yet if the Committee stage produces results on Report, the Opposition should surely not complain.
But the truth is that the Opposition did not want to use the Committee to consider the Bill in detail. They used it as an instrument for a purely political campaign.

Mr. Peter Walker: A minute ago the right hon. Gentleman argued that he had to move 192 Amendments, most of them due to criticisms made in Committee. Now he argues that no criticisms were made in Committee.

Mr. Marsh: It is not a question of criticism made in Committee. Amendments were put to meet specific points made from both sides of the Committee. That is surely the purpose of having a Committee stage. If it is not assumed that a large Bill will be amended on a large scale, what on earth is the purpose of having a Committee stage? I think that the intention behind the Opposition's attitude has been to present their friends in another place with the maximum amount of provocation, and we should get that clear.
This is a Government Bill. It reflects the mandate upon which we were elected. We intend to have the Bill because we are entitled to it as the elected party.

Mr. John Biggs-Davison: Go to the country.

Mr. Marsh: This part of the Government does not accept the process of referenda. We do not intend to be


diverted from our objectives by spurious arguments about abuse of procedure from those who have made every effort to prevent sensible discussion of the details. We are dealing here with a subject which affects everyone in the country. Everyone is involved in transport and needs the best we can give. Transport is one of the problems which have affected the economy significantly because decisions have to be wide-ranging and imaginative—and that is what they are in this Bill. They are bound to involve controversy and it is the failure of successive Governments to face this sort of measure of economic planning which bears a large proportion of the blame for the difficulties we have today.
The Government accept that this is a controversial Bill. It is right that it should have been properly debated. It is a Bill which is crucial to the economy and its contribution will be very much commended.

Mr. Speaker: I remind right hon. and hon. Gentlemen that the Chair will put the Question on the Third Reading at at 11.47 a.m. Many hon. Members wish to speak, so I hope that speeches will be reasonably brief.

11.25 a.m.

Mr. Peter Walker: Perhaps one of the most significant of the right hon. Gentleman's phrases was that this part of the Government does not believe in referenda. There is no part of the Government which would fail more in a referendum than his.
I first want to express our thanks to a number of the Ministers, particularly the Minister of State. [HON. MEMBERS: "Hear, hear."] He has, in many debates in Committee and on Report, borne a great deal of the burden and with the change of Ministers during the Committee stage an extra burden was put upon him. We disagreed with most of his replies, but we thank him for the consideration he gave and the work he has done.
I also want to thank my hon. Friends, particularly the hon. Member for Tavi-stock (Mr. Michael Heseltine), the hon. Member for Moray and Nairn (Mr. G. Campbell) and the hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor), who have done a considerable volume of work and have made detailed criticisms. I think, too, that both sides

will pay tribute to the hon. Member for Bodmin (Mr. Bessell) for his conscientious and lone efforts. [HON. MEMBERS: "Hear, hear."]

Mr. Ron Lewis: What about the hon. Member for Weston-super-Mare (Mr. Webster)?

Mr. Walker: My hon. Friend the Member for Weston-super-Mare needs no specific thanks because he himself will be winding up this debate for the Opposition in the same skilful way in which he wound up many debates throughout the proceedings of the Bill. We certainly pay tribute to him for what he has done.
The Bill will now go to another place. This major piece of legislation goes to its Third Reading in this House with one-third of the Clauses not debated either in Committee or on Report. Possibly for the first time with a major Bill it goes to Third Reading without any back-bench Members on either Opposition parties having had an opportunity to say one word in support of any new Clause which they wanted to insert. No time was given in Committee and on Report for new Clauses, apart from the Government new Clauses. This was not our fault. The Government tabled additional new Clauses, thus preventing discussion on any Opposition new Clauses.

Mr. Ron Lewis: Had the Opposition been a little more courteous in Committee to the Government, new Clauses such as that submitted by me would have been reached.

Mr. Walker: They would not. Indeed, many Government Clauses were guillotined in the Committee. I deplore the manner in which this legislation has been steam-rollered through the House. The rather pathetic defence by the Minister of the way the Government have acted will not bear examination.
The Bill was badly drafted in the first place. The right hon. Gentleman has mentioned 192 Amendments which the Government moved on Report. He rightly said that many were made to meet points raised in Committee. Therefore, nearly 200 Amendments were needed on the two-thirds of the Bill which were discussed in Committee.
Quite obviously, if we had had the time to make the other third of the Bill something like 300 Government Amendments


would have been necessary. This is in addition to more than 200 Amendments moved in Committee. In total, 400 Government Amendments, something like 32 for every Clause, have been necessary because this Bill was so badly drafted in the first place and the policy behind it was so wrong. Even in the Government's view something like three Amendments per Clause were needed to get this Bill into some proper shape. This was the result of putting 10 Bills under one title.
I very much deplore this, because certain sections of the Bill, the inland waterways section for instance, is of importance to many people with particular interests and pastimes. In total, five hours of debate have been given to what should have been quite a major piece of legislation in itself. The licensing system, which the Minister mentioned, and the discussions which took place upon it, are another example of the way in which the Government dealt with this. The Minister said how appalling it was that the Opposition should have the temerity to want to debate the effects of quantity licensing on the various major industries in the country. "Fancy wasting time doing that", he said. As every hon. Member knows, there should have been a major licensing Bill. Both sides of the House are agreed that the quality licensing is very important, and I very much favour it. We all know that many technical improvements were made in that system and many Amendments have been accepted by the Government. The Government appreciate this.
Here was a major licensing reform, crammed in with all the other legislation in this enormous Bill. The result is that we have this massive piece of legislation for which we were allowed one hour for Second Reading, two hours for Third Reading, and the whole of the Committee and Report stages cramped into a limited timetable—one of the worst examples of steam-rollering legislation through Parliament in the history of this House. I very much deplore it.
The overall theme of the Bill has been interesting. There are sections of the Bill which are non-controversial, such as the inland waterways, quality licensing and many of the miscellaneous provisions. Parts have been improved and

sensible debate has taken place. The major theme, which is wrong, because the previous Minister was devoted to it, was the extension of public ownership. The theme contained in the proposals for the National Freight Corporation is one which, combined with the borrowing powers and the activities of the Corporation, will almost certainly result in considerable wholesale acquisition of private enterprise haulage firms, with money obtained through the borrowing powers in the Bill.
The theme of the P.T.As was to bring into public ownership, buses and coaches throughout the country, and it will doubtless succeed. The theme of Clause 45 was to extend on a wholesale range the activities of the nationalised industries. The theme of the quantity licensing provisions was further to handicap the free enterprise sector. It is this appalling concentration on public enterprise to the detriment of free enterprise that has made the Bill such a bad one. It deserves to be opposed and attacked.
As for British Railways, one of the worst features in the Bill is the taking away of the freightliner train. The Minister attacked this side of the Committee for trying to oppose British Railways and the nationalised industries. It was this side of the Committee which tried to retain for British Railways the potentially fastest-expanding activity they possess. It ill becomes the Government that runs British Railways on the basis that the Deputy Chairman is paid more than the chairman, that takes away the most potentially expanding part of the railway system and gives it to a new authority, to talk about what they want to do to improve British Railways. As to the railway deficit, we must not forget that it was this Government, having been in power for 12 months, which said in their National Plan that by 1970 the railway deficit would be abolished, without the measures contained in this Bill.
They have failed, the deficit has increased and now the morale of British Railways will be undermined at the loss of the freightliner train. The P.T.A.s are supposed to be to organise local transport, yet there is hardly a local authority, Labour or Tory that has not opposed the P.T.A. concept. This has been approached not from the point of view of giving additional powers of planning and


organisation to local authorities, it has been tackled from the point of view of creating an organisation which can extend public ownership, take over buses and go into various other activities. Once again the problem is one of co-ordination and planning, but the theme of the Government was extending public ownership by various means of back-door nationalisation.
As to quantity licensing, apart from the Minister, it does not have a defender in the country. Every editorial in every newspaper, Left-wing or Right-wing has deplored the system. Every section of industry has deplored it. Agriculture and industry combined to say what an absurd bureaucratic conception it is. [Interruption.] The only mutter that we can get is from the loyal hon. Member for Central Ayrshire (Mr. Manuel), and even he is not in his usual enthusiastic voice for this particular contest.

Mr. Archie Manuel: I had in the House yesterday a big industrialist, and I introduced him to the Minister of State. Quite voluntarily this man told my hon. Friend that he and other industrialists supported the quantity provisions in the Bill.

Mr. Walker: All I can say is that if I had any shares in his company I would sell them quickly. How can an industrialist consider it to be an advantage to have to request the Government for the use of his lorry for a distance of more than 100 miles? Everyone is opposed to it, it is bureaucratic, it is absurd and it has no friends. It is a form of restriction which will handicap British industry, and add to its costs.
Therefore, when examining the Bill, we see that one of the great themes is added cost. The Minister gave a preliminary outline of the findings of the Prices and Incomes Board. May I say how I deplore the failure of the Government to publish this before this week's debate. Here was a report which would have been of great importance to us in discussing many sections of the Bill. Strangely, by coincidence, a few hours after these proceedings are ended, this report will be published. I gather the theme of it will be increased fares and probably increased freight charges. We will obviously have to study the proposals when they are made available.
The P.T.A. proposal will certainly mean increased fares and rates. Industry is in no doubt that the other sections of the Bill will add to its costs. The multiple tailors have calculated that it will add something like 3d. in the £ to prices, and their figures have in no way been refuted. One of the best things that could be done is that the former Minister of Transport who is now responsible for prices, a responsibility that resulted last month in the biggest rise in prices for many years, should come to the House and urge the rejection of the Third Reading of the Bill. In that way alone, she could make some contribution toward reducing prices.
This Bill has been steamrollered through Parliament. The effects of it will be to add to the cost of living, to handicap the efficiency of the transport system, to increase bureaucracy and nationalisation. It has all the basic ingredients of a thoroughly bad piece of Socialist legislation. I very much regret that any Government faced with the economic problems that face this Government should decide in this Session of all Sessions to have as their major piece of legislation, a Bill which has so many adverse effects on the economy as a whole. We will probably have further debates on this because we know that Amendments will be moved in another place. The Government have already listed a number of matters concerning which they will try to move Amendments. We will probably welcome most of those Amendments. Possibly other Amendments may accompany them.
When this Bill reaches the Statute Book it will be a bad Bill if it is in anything like its present form. It will have provisions handicapping to the progress of the British economy. At the earliest opportunity we will see that those sections of the Bill which do so much damage to the economy and to the efficiency of industry, to the fares and rates of the people of this country, are tackled, amended and repealed. We hope that the harm the Bill will do, if it is ever put into operation, will at least be short lived.

10.41 p.m.

Mr. Archie Manuel: We are rushed for time, so we shall all have to speak quickly and possibly not


dwell as long as we should wish on what we consider to be our strong points.
I remember the dismal experience that I had as a member of the Committee that steamrollered the 1962 Act through the House. The intention of the 1962 Act was to drive more and more traffic on to our already congested roads, and this was admitted at the time. The party opposite had no great campaign then in Committee or in the House or even in the country. They wanted to accom-pish what they did in the 1962 Act by stealth. There was no campaign team and no rallies up and down the country. Everyone realises now that the 1962 Transport Act was a bad Act. Transport problems have got steadily worse because of the congestion which has been caused on our roads, and an under-used railway system has caused steadily increasing railway deficits. Railwaymen have become more and more disheartened. Any Government worth its salt had to deal with this worsening position. Hence the reason for the present legislation being brought forward.
I congratulate the Government. I willingly worked through our long Committee stage, because this Bill for the first time tackles the basic transport problems of this country, giving us a railway network which will serve the country and try to bring sanity into a road system by transferring huge loads, where possible, off the roads and on to our railways.
When this Bill was brought forward, with its many enlightened provisions, the party opposite started a great campaign against it. Some of my hon. Friends on this side have been closer to that campaign than I. At any rate, we know that money has been spent like water to try to turn public opinion against the Bill. But it has failed, despite the avalanche of posters about "Kill the Transport Bill" and rallies being held up and down the country. Despite the high-powered campaign—[HON. MEMBERS: "Oh."]—and the briefing team, and the hon. Member for Worcester (Mr. Peter Walker) boasting that he was spending £10,000 of his own money to pay the briefing team, the campaign has petered out. There is hardly a flicker of life left. That is despite the 4s. levy

per vehicle put on their members by the Road Haulage Association. It must have amounted to hundreds of thousands of £s. I should like to know what will be done with it, because the people concerned have had a bad bargain. [An HON. MEMBER: "Give them the money back."] We have to remember that the pledges made by the party opposite to these people have not been honoured. The campaign is as dead as the dodo It is a dead duck.
I pay tribute, as did the hon. Member for Worcester, to the hon. Member for Bodmin (Mr. Bessell). From the start, the briefing team assisting the Conservative Party was behind the Liberal Party all the way in the Amendments with which they were trying to deal in Committee. I am surprised that the hon. Member for Bodmin, with the skill he had at his elbow and the ammunition that was being passed to him on every Amendment, should have been so slavish in his idolatry of the Tory Members on the Committee. This was my whole complaint. If the Liberal Party stood for anything—and I want to deal with the Scottish provisions for a moment or two—it was the devolution of more power to the local authorities, and more power to the Scottish Office. Therefore, I could not understand why they voted against Second Reading. The creation of the new Scottish Transport Group, bringing more control to Scotland and bringing the main bus services directly under the control of the Scottish Office is an important step. I know of no area in Scotland where this is more important than in the Highlands. Most of the transport services in the crofter countries are not viable and are heavily subsidised.
The hon. Member for Worcester talked about nationalisation and bringing transport into common ownership. This is necessary in these areas in Scotland. When hon. Gentlemen opposite talk about fringe activities in the crofter counties in Scotland, what are they criticising? How would the hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor) take the mails into Ardnamurchan in North Argyll? The mails are taken in by the passenger coach service. I recognise the great importance of this Bill to Scotland. It will serve the needs of the people.
No publicity has been given to the many provisions in the Bill which will


be of immense benefit to everyone. The hon. Member for Worcester did not speak about concessions for old people. Did we ever read about it in the Press? Did it ever have any publicity on radio or television? No. But this Bill brings in concessionary fares for old people. Local authorities up and down the country will be able to bring in this concession. The party opposite have steadily opposed this concession being given.
There are many other provisions: 25 per cent. subsidy for the provision of new buses, and quality licensing to make our roads safer; subsidies to keep open socially necessary railway lines; the 50 per cent. grant to local authorities to enable buses and ferries in Scotland to be operated by the local authority if thought necessary.
We have provided the necessary machinery and impetus to provide a great step forward in transport in this counutry. We pledge ourselves to see it to finality and ensure that the party opposite will not ruin it.

10.49 a.m.

Mr. Peter Bessell: I must start by paying tribute to the Minister of State who has carried an intolerable burden throughout the whole Bill with such good humour. He has always been helpful. I pay tribute, too, to his colleagues on the Front Bench who have always helped and assisted me throughout the many stages of the Bill.
I also add my thanks to the members of the Government party, who, in Standing Committee and on Report stage, have shown me every courtesy. I do not like to single out any one Member, but, if one, the hon. Member for Central Ayrshire (Mr. Manuel).
I now part company with the Government benches and pay tribute to the hon. Member for Worcester (Mr. Peter Walker) who has led his party in a strong, firm and realistic opposition. Although there may be ideological differences between the three parties, no one can say that the hon. Gentleman has done other than a first-class job.
We are now reaching the end, in this House, of the lengthy stages of this massive Bill. As I leave the House of Commons for good at the end of this Session, perhaps I may claim to have expertise in one matter at least, and that is the Trans-

port Bill. I am glad of this, because transport has occupied much of my political life. It is an important subject and affects the whole economy. It has, therefore, been fascinating to be so closely associated with the Bill. If it was, in many ways, a happy experience, this is not because the Bill, as it is, commends itself to me or to my party. It is impossible, because of limitations on Third Reading, to state again the ways in which I think that an integrated system of freight and passenger transport could be obtained.
But before I criticise the Bill I must say that there are some parts, and certain sections of others, which are entirely praiseworthy and which I wish had been introduced separately so that I could have supported the right hon. Lady the Secretary of State for Employment and Productivity, who introduced the Bill when Minister of Transport. The Clauses dealing with the Railways Board, particularly the grants for unremunerative passenger services, the new bus grants and the additional assistance to bus operators by refunds on fuel duty are sound thinking and will be of genuine assistance to transport.
It is equally fair to mention the quality licensing system, which is aimed at improving road safety and the safety of drivers of heavy vehicles and the public. This legislation, which is overdue, will, in spite of some technical defects, be a valuable contribution to the already successful safety measures introduced by the previous Minister.
The new powers given to the nationalised boards are helpful so far as they permit those boards, particularly the Railways Board, to use spare capacity to produce goods which will assist our export drive and provide new opportunities of employment. I hope that this will prove to be a means of mopping up some of the surplus labour which will be a consequence of the streamlining of the railways system, and thus alleviate any hardship which might otherwise have occurred.
Part VII of the Bill, which will give new life to the inland waterways system, will also be welcomed, not only in the House but throughout the country. I pay respectful tribute here to hon. Members on both sides who have campaigned for many years in Parliament and in the


country for the better use of this indigenous asset. No one has done more than the hon. Member for Nantwich (Mr. Grant-Ferris) who was our superb and, I do not hesitate to say, beloved Chairman in Standing Committee F.
Alas, these are the main points of the Bill which deserve commendation. The reasons that the other parts are unacceptable to me and my party are because of the ideological differences between us— gulfs which cannot be bridged—which we recognised clearly in Standing Committee. Hon. Members opposite will not be surprised to hear me say that the overwhelming majority of these 255 pages contain Clauses which are reactionary Socialism at its worst.
There are provisions which will permit nationalised boards to enter into realms of retail trading which are divorced from transport and which will, I believe, be a genuine threat to the financial stability of business enterprise in the private sector. Equally, the local authorities are not, as the Minister has so often insisted, having additional powers in the matters which count. Instead, they will be over-ruled by the passenger transport authorities, which they do not want and which are not necessary.
Apart from the Ministerial nominees, who I concede will not be in the majority, local authorities will always be subject to majority decisions. Those of us who know something of the inevitable local rivalries, which are not necessarily always bad and which frequently lead to a healthy spirit of competition, also know how difficult it is likely to be to obtain a consensus which will not victimise smaller local authorities and their systems of communications. Too little thought has been given, in preparing this part of the Bill, to the consequences—particularly the new rights of rating authorities to make precepts on the rates for passenger transport services.
If Part I, which is headed "Integration of freight transport services", consisted only of Clause 6, which sets up the Freight Integration Council, it might be unexceptionable, but the powers of the Corporation as spelled out in Clause 2 and in the iniquitous Clause 5, which transfers to a subsidiary of the Freight Corporation 51 per cent. of the freight-

liner service which has been promoted and is being operated so effectively by British Rail, are among the most needless, wasteful and totally unnecessary provisions of the Bill.
The freightliner service is an integral part of British Rail and we believe that it will be the most profitable of its services. It may be the means of reducing the debt of the Railways Board and providing an eventual profit if it is left under the control and management of that body However, this is not to be. We find it objectionable, also, that the Corporation should have such wide powers for providing additional freight services beyond those which are operated at present by the Transport Holding Co.
I have referred to Part II and the whittling down of the powers of municipal authorities over transport by the establishment of Passenger Transport Authorities and Executives. The right of the P.T.A.s to operate car parks, garages, and other forms of retail business is as needless as it is objectionable.
I know that I speak for my Scottish colleagues when I say that the establishment of the Scottish Group in Part III is not welcome to them or to their constituents and I do not believe it to be necessary for the efficient control of transport in that country.
The National Bus Company is another example of unnecessary extravagance and the formation of a new undertaking which adds nothing to our existing passenger transport service but will, I believe, be a grave threat to the private operator.
I have always had some reservations, which have been shared by hon. Members opposite, about the relaxation of control over certain bus services and the freedom which will be given to the many bus operators in Clauses 30 and 31. However, I do not pretend that, in this matter, I necessarily speak for my party. I am expressing a personal view which is shared by many hon. Gentlemen opposite.
I have said that we welcome Clauses 32, 33, 34 and certainly 36, but it is on Clause 45 that the real division between the two sides of the House and between the Government and the Liberal Party is seen with such stark clarity.
The powers of the new boards will be so sweeping that, as I said in Committee,


there appears to be nothing to prevent them, particularly the Waterways Board, from selling whatever they choose, from matchboxes to monkeys. The only safeguard is that such activity must be commercially viable, although no one has explained how one can prove something to be commercially viable until one has had practical experience in trading, by which time much public money may have been wasted.
This Bill is perhaps unique in Parliamentary history, since it will cause a case which has been before the courts for four years to fall automatically.
Part V is a mixture of much that is good—I refer to quality licensing and much that is bad—and I refer to quantity licensing. I do not agree that all forms of quality licensing should be abolished, although the method that the Government propose to adopt will be wasteful and expensive and could cause serious delays and confusion in our vital export industries. I have greater faith than the Minister of Transport in British Rail's ability to compete, through its freight-liners, with the road haulage industry.
The drivers' hours provisions have never been properly debated here or in Standing Committee, because of the guillotine. Although it is necessary and right that there should be some changes in legislation which is now more than 30 years old, it is not right to make these blanket provisions, which will penalise the development areas and the remoter rural districts, which are in such need of encouragement and development.
We have not been able properly to debate the new Clauses which were introduced so late but this is not the time to comment upon their merits or otherwise. It is to be hoped that they will have proper attention in another place.
The Transport Bill of 1967 is almost at the end, in this House, of its long but unfortunately not very perilous journey. The Government majority has been used —some may think properly, others improperly—to ensure that it completed its passage far too quickly. I would be the first to acknowledge that the Minister has gone some way to meet our demands. Nearly 70 amendments of mine have been accepted either completely or in principle, and, of course, I am grateful for this, but my real hope lies in the next stage,

for it is in another place that the radical dissection may take place which is necessary for this to be the valuable Act of Parliament which I accept was the intention of the right hon. Lady.
The Transport Bill may be said to have started as a Castle, the ramparts of which we on this side could not breach, and to have sunk now into a Marsh. Unhappily, the marsh has not submerged it. So I ask my right hon. and hon. Friends to vote against Third Reading. I do so sorrowfully because I believe that we need a proper, integrated transport system, that the Government had the golden opportunity to introduce it and that, with the right approach and less ideological Socialism, they could have achieved the objective.

11.0 a.m.

Mr. Leslie Huckfield: As far as I can see there are in the country two main extreme views about transport. One suggests that every little village and every small town should have its own railway halt, whereas the other seems to suggest—and we have certainly heard it from the hon. Gentleman the Member for Glasgow, Cathcart (Mr. Edward M. Taylor)—that everything that moves is to be nationalised.
Personally, I believe that this Bill comes somewhere between the two, but because of the campaign that has been conducted I do not believe that anybody, in the House or outside, really appreciates that. It is fantastic when we find road hauliers absolutely convinced that they will not in any circumstances be allowed to take their vehicles a distance of more than 100 miles and when the main streets of certain constituencies can be completely blocked by road hauliers protesting against the Bill.
The road haulage industry and the Tory Party would have done more justice had they stuck to the Bill and to the facts, because if one totals up the money that has been spent by the Road Haulage Association in support of the Tory Party in 1950, 1951, 1955, 1959 and 1964 one sees that if that money could have been spent on implementing the quality licensing parts of the Bill and those parts of the Bill dealing with improving drivers' conditions and giving them better wages, then much of the Bill, including especially the quality licensing and drivers' hours provisions would not have been


necessary. It is because money has been spent on these wrong purposes and has not been spent on the improvement of the road haulage industry that many parts of the Bill have been necessary, and hon. Gentlemen opposite know it.
I am glad that at last we have come to the end of the Alice-in-Wonderland system of railway deficit financing. At last, we have a perfectly clear-cut division between those parts of the railways which are expected to pay their way and those parts which socially are very necessary. I only wish that some hon. Gentlemen on the benches opposite had "come clean" on this, because it seems to me that in this year, as in 1962, there is no greater humbug than to see hon. Gentlemen opposite voting against the railway subsidies in this Bill, for when a line in their own constituencies comes up for "the chopper" they will be queueing up outside the Ministry of Transport asking for subsidies.
That is humbug and hypocrisy. To me The Bill represents a testimony of faith in public transport. It is a testimony of faith that is very much needed in that part of the country that I represent in the West Midlands, where we have a situation so serious that it will not wait for reform of the local authorities or for the Tory Party to come up with a hybrid scheme. It will not wait any longer than this year, and this Bill will do it.
I hope, therefore, that now that we have public passenger transport put on a democatic basis we can put an end to the vagaries and whims of the big bus companies like the Midland Red and others up and down the country which have held many of our constituencies to ransom. I praise the concept of the National Freight Corporation because under that concept it will be possible for a nationalised industry really to offer a comprehensive service. The transport service of the future will be one under which the Corporation can offer—and this is being done already by British Road Services—to take care of a firm's total distribution.
This is the kind of way in which transport is moving. This is the way in which transport is being speeded up by this Bill. Therefore, I am glad that we are to end this senseless competition between British Railways vehicles and

British Road Services vehicles. That is a reasonable and sensible step.
I am also glad that, at last, we have taken the shackles off the manufacturing power of nationalised industry; because when hon. Gentlemen opposite were in power they deliberately restricted the manufacturing power of the nationalised industries so that those industries could not produce at their lowest economic cost because of political bias. That was humbug and nonsense. By restricting those industries and keeping down their capacity, hon. Gentlemen opposite knew very well they were forcing up the cost per unit of output of the nationalised industries.
By putting in Clause 45 and increasing the range of manufacturing powers we have for the first time in history ensured that the Railways Board and the National Freight Corporation will not be at the mercy of private enterprise to whom in the past they have had to go for much of their equipment.
I do not like certain parts of the Bill. Hon. Gentlemen opposite may have noticed that yesterday I abstained on certain provisions on quantity licensing which I do not find very palatable. But the abolition of the 1933 system of "A", "B" and "C" and contract licences and the freeing from the licensing provisions of about 900,000 vehicles and the concentration on vehicles travelling over 100 miles and carrying over 10 tons gross, is very sensible. I am glad to see that a great part of this was recommended in the Geddes Report. I challenge some hon. Gentlemen opposite to implement the conclusions of that Report of a Committee which they set up. They know that if they implemented its true findings their biggest enemies would be the Road Haulage Association.
It has amazed me that apart from the Cornish wisdom, which went slightly awry yesterday in regard to the distance between London and Penzance, hon. Gentlemen opposite should have claimed that the Cornish fishing industry is absolutely and utterly dependent on a longdistance lorry driver being able to work more than 10 hours—a fantastic claim— and that the whole industry depends on a man working such hours.
We have had similar arguments before, but those arguments were put forward over 150 years ago. They were


the arguments of the Bradford textile mills and the Lancashire cotton mills. They were the arguments which put children of 12, and women, down the pits. Those were exactly the same kind of arguments that we had yesterday on drivers' hours from hon. Gentlemen opposite.
It is shocking that there should be an average working week of 58·9 hours, with 40 per cent. of the drivers working more than 60 hours a week, and that a fortnight ago, in Banbury, drivers went on strike for a 68-hour guaranteed week. If this kind of thing still exists then I am in support of doing something about drivers' hours.
On quality licensing, some hon. Gentlemen opposite have said standards are too high; and they have quibbled on some points. But of 142,831 vehicles examined in roadside checks in England and Wales a total of 55,000 were found to fail the test and so bad was the position revealed by those checks that almost 13,000 vehicles had to be taken off the road straight away. What a terrible indictment of an industry which has been spending so much money against this Bill and in support of the Tory Party!
This has been a long Bill and it has had a long passage. The hon. Gentleman the Member for Worcester (Mr. Peter Walker) has felt himself able to spend £10,000 against it; but to me it seems that we have, at last, a Minister who has done something about the problem of canals, who has written into the Bill a testimony of faith in public transport and has shown that we have a Government that believes in the railways. I do not believe that that is a crime and I am glad that at last something has been done to make the road haulage industry of this country "grow up."

11.10 a.m.

Mr. Daniel Awdry: It is not easy to describe my feelings about the Bill in five minutes, but I shall try, as I have promised to keep to that time.
Throughout the Committee stage I was chiefly concerned with the licensing provisions, and it is on that part of the Bill that I should like to speak now. It was monstrous that this part of the Committee stage was so ruthlessly guillotined, for this meant that many aspects of both quality and quantity licensing were never properly discussed. The whole question

of quality licensing is not very contentious, and the Opposition's purpose throughout the Committee stage was to try to keep the red tape and bureaucracy down to the minimum.
I particularly resented the fact that, in Committee, we never discussed the new concept of transport managers' licences. I realise how unfortunate that was when we reached Report, because the Minister told us then that he was having discussions with all the interested parties, and it was clear from his speech that he had little idea of how the new concept would work in practice. He threw out the interesting idea that a farmer could appoint the local garage as his transport manager. It was a pity that we did not have a chance to point out in Committee some of the very obvious snags of such a suggestion.
I was also particularly disappointed that our Amendments to exclude fleets of one and two vehicles from the transport manager provisions was not accepted. Our Amendment would have helped to make the project work in a more practical way.
I also resented very much the fact that we never discussed the procedure for appeals against revocation of operators' licences. But I am glad that the Government agreed to accept our Amendment providing that appeals shall be made to the Transport Tribunal and not to the Minister. That is an important and fundamental change which will certainly improve the Bill.
I now turn to quantity licensing. The effect of the Guillotine in Committee was particularly vicious here. A great deal of the detail has never been discussed either in Committee upstairs or on the Floor of the House. This is a scandal because the objection to quantity licensing is practical; my hon. Friends and I and the Liberal Members believe that it will not work in practice. The Minister complained this morning that we raised individual cases one after another in Committee. He seemed to think that it was a waste of time to spend five minutes discussing, for example, forestry or horticulture. This discloses the Government's wrong attitude to the problem. It is not only the road haulage industry that will be affected, but every branch of industry up and down the country. I do not believe that we wasted any time


in drawing the Government's attention to these points.
I am certain that the licensing authorities throughout the country know only too well now that their task under the Bill will be utterly impossible. We have said a hundred times, and I repeat once more, that our objection to quantity licensing is that it interferes with consumer choice and tries to substitute State direction for commercial judgment.
If I had to single out one aspect of the system which best emphasises its utter stupidity, I would mention the question of return journeys. The road haulage industry depends on return loads to keep down its costs. That is why the whole question of what we described in Committee as general blanket authorisations became so vital in our discussions. Only if the authorisations are issued on a general and not a special basis, will some flexibility be introduced into the system. At no time did the Government explain how this difficulty could possibly be overcome.
That is only one of the many insuperable objections to the whole foolish plan. The criteria to be considered by the licensing authorities are still wholly inadequate. The list of exempted goods is far too small. The licensing procedure is far too cumbersome and too slow. The system is restrictive, Socialist, and above all, theoretical rather than practical.
So, at the end of many days and nights, we have produced a thoroughly bad Bill. This is disappointing after 200 hours of hard labour. But there is one gleam of light. We are told that the quantity licensing provisions will not come into effect for another two years. Before that time expires, I am confident that this foolish, wrong-headed Government will no longer be in charge of transport or of anything else.

11.15 a.m.

Mr. Ted Leadbitter: I shall confine my remarks to about two minutes, because hon. Members on both sides of the House have sat here for many hours and I should like as many as possible to have the opportunity of speaking. Many charges have been made against the Bill. One is that it has been steam-rollered through the House and that there has not been sufficient time for

consideration. But we have debated it for about 220 hours. The OFFICIAL REPORT of the Standing Committee proceedings weighs about 4¼ lbs. I have here a copy of Plato's "Republic", which weighs 1 lb. and deals with the whole of human endeavour. The charges made against the Bill are pure exaggeration.
The hon. Member for Tavistock (Mr. Michael Heseltine), in reference to Clause 45 and the manufacturing powers of British Railways' workshops, talked the other day in terms of setting up oil refineries, and steelworks. When I challenged him on the Floor of the House, he said to me, "Find the column." I found it later in the day and although I could not make him say it in the House, he saw me privately later and said that he had found it himself, and that if I had found it in the House he would have withdrawn his allegation.
Apart from the exaggeration and innuendo, and the great political campaign outside, we had a very enjoyable Committee stage. There have been many happy moments.
The hon. Member who impressed me, apart from hon. Members on both sides of the Committee and my hon. Friend the Minister of State, Ministry of Transport, was the Chairman of the Standing Committee, the hon. Member for Nantwich (Mr. Grant-Ferris). He has been very kind and tolerant, and I am sure that we enjoyed the whole of the 200 hours we worked upstairs with him.
It was a jolly Committee, and a great deal of good work has been done. There was a good deal of political banter, but we have taken the opportunity of according each other our gratitude for the work done. I need not repeat names mentioned earlier, and, therefore, I give way now to allow other hon. Members to speak.

11.17 a.m.

Mr. Geoffrey Wilson: The basic fault of the Bill is that which affects so much of Labour Party thinking on transport. The Government do not appreciate that transport is always a means to an end and not the end. A person transports himself or his goods from one point to another for purposes that are entirely his own affair, and because individuals are so different it is impossible for the gentlemen in Whitehall or anybody else to estimate with any degree


of accuracy exactly how much of any particular form of transport the public want. If one relies on a number of private enterprise firms some will go to the wall, because they will mistakenly suppose that some form of transport is required which, in fact, the public do not want.
If one tries to centralise transport into large organisations, mistakes are bound to be made because the pattern changes all the time, and not on any logical system. It is just a question of whim, fancy and fashion very often. It is very difficult for a central organisation to estimate how much is required. The Bill increases the powers of the central organisation. It concentrates the bus services and puts haulage into bigger units. Therefore, I think that it will be found to make matters more difficult and not to be an improvement on the 1962 Act, in which we tried to provide a greater degree of flexibility of competition. We tried to estimate what was required, but we did not attempt to do so with any degree of accuracy.

11.20 a.m.

Mr. James Bennett: This reminds me of end-of-term day, with people patting each other on the back, and there is no reason why I should not indulge in doing so. I join the hon. Member for Bodmin (Mr. Bessell) and the Minister of State in their tribute to the Chairman of the Standing Committee. I also join in the tribute to the hon. Member for Worcester (Mr. Peter Walker). Undoubtedly, this has been a happy Committee.
I achieved a certain amount of success with one or two of my Amendments. At the same time, I must voice my own fears about quantity licensing; but I will not go too deeply into that. I sincerely hope that what I think will happen will not happen. We can be honest at this late stage of the game. In spite of the reservations I had about quantity licensing I voted for it in the Standing Committee.
I am disappointed in one thing. I received certain assurances about worker participation and I was happy about this. My happiness was short-lived when I came to read the Bill. I hoped that passenger transport authorities would be set up for Scotland. II ever that happens

I hope that worker participation will be effective, since the assurances I received suggested that worker participation could come only from outside the area of the P.T.A., and that would mean that representatives would have to come from Carlisle, which is out of the question.
I have enjoyed working on the Bill with my colleagues on both sides of the House. I am not an expert in transport. Having listened to some of them, I am glad that I am not. That we have established a record in the Standing Committee does not mean a great deal, but the fact that each of us has gained knowledge of what could happen, and what we would like to happen in transport, should make us better legislators. I welcome the Bill.

11.22 a.m.

Mr. Keith Stainton (Sudbury and Woodridge): Time is running short, and this is a feature which has characterised the Bill in all its stages. I had intended to start by paying a tribute and by itemising points of controversy, but instead I will draw the attention of the House to one or two more general matters which have struck me during the passage of the Bill.
We should be concerned about the financial disciplines of the P.T.A.s and the accessibility of the P.T.A.s to Parliamentary Committees. The National Bus Co., the National Freight Corporation and British Railways will be open to the Select Committee on Nationalised Industries. The position about the passenger transport authorities, which represent a large sector of public transport, is not clear. If that side is to be dealt with by the Estimates Committee there will be a division of attention which could be to the detriment of transport as a whole.
On the National Freight Corporation, my persuasion is in terms of the set-up with which the Government have come forward. I prefer the functional concept here, but I was impressed with the speech made by my hon. Friend the Member for Worcester (Mr. Peter Walker) when he wound up the debate on Tuesday on the loss of the freight-liner service to British Railways. The Government must take heed of this point in stripping down the railways' management attractions.
As regards British Railways, I compliment the Government on the terms of the managerial structure which is propounded in the White Paper, although, at the same time, we must have severe misgivings about the lack of management techniques in the railways which is revealed in the White Paper.
The size of the Bill is something which has made a direct impact on all members of the Committee and on hon. Members of the House. Could I underline the impact on industry? Only a few weeks ago, in my capacity as chairman of a public company, I asked the secretary of that company to prepare a list informing me of major legislative changes since 1964. I imagined that I should be able to set up a table to highlight the main features in the middle of the printed list. However, my secretary came forward with five closely typed quarto pages containing legislative and other changes of an important nature which have come about since 1964. I counsel the Government on the dreadful impaot of the licensing changes on industry.

11.26 a.m.

Mr. Ron Lewis: I join in the general chorus of praise to every member of the Standing Committee. The members of the Standing Committee will, I hope, in the not-too-far-distant future be cruising down the canals, with the Chairman of the Standing Committee.
I cannot go all the way with the hon. Member for Truro (Mr. Geoffrey Wilson) when he made a reference to the 1962 Act and its flexibility.
I welcome the Bill on behalf of rail-waymen who, for too long, have had a raw deal at the expense of road haulage. The integration of railways and road haulage is something that some of us have longed for and therefore, on behalf of the railwaymen, I give the Bill my blessing.

11.27 a.m.

Mr. David Webster: As the shadow of the Guillotine comes upon us once again there is regret that many of our colleagues have been unable to participate in even the Third Reading of the Bill. May I pay a tribute to the Chairman of the Standing Committee—who is now blushing and wriggling—for his excellent chairmanship over a long period? This he performed

single-handed save for a few seconds when the hon. Member for Central Ayrshire (Mr. Manuel) took the Chair. To have taken the Chair so skilfully is a distinguished achievement.
May I also pay tribute to the hon. Member for Bodmin (Mr. Bessell). I was sorry to hear that he would not be coming back to Parliament but I hope, if one may conjecture on Third Reading, that he will return, possibly in a different guise.
I also pay tribute to the Minister of State, who has shown tremendous stamina. He has been most courteous, and has done his best to give us answers; sometimes he has given us two or three answers! We have been grateful for the way in which he has persevered. It has been an extraordinary mental and physical achievement, and I hope that he enjoys the Whitsun Recess. I have heard that he had a dream as a result of which he woke up screaming. He had a vision that the Prime Minister had sent him a message to say that in the Birthday Honours he would be sent to another place as a Lord-in-Waiting to steer this Bill through the other place.
To my hon. Friend the Member for Worcester (Mr. Peter Walker) I give heartiest congratulations. He has received a few remarks from the other side which no doubt he would have been surprised not to receive, but his achievement on Second Reading, Committee stage, Report stage and in the country has been to demonstrate the true facts of the Bill and to challenge the Government. The fact that we have had so many Amendments accepted and passed is a tribute to the Tightness of his judgment. I am sure that the whole distributive industry is grateful for his achievements, his efforts and his dynamism.
Today, we are seeing the twin legacy of two people who were, at the beginning of the Bill, the Minister of Transport and the Leader of the House. The erstwhile Leader of the House has reduced the arrangements in this building to sheer chaos—[HON. MEMBERS: "Oh."]—it has been proved throughout the whole of this week. In her turn, the former Minister of Transport, with her Left-wing doctrinaire views, has endeavoured to reduce the distributive industry to near-chaos.

Mr. Leadbitter: Cheap.

Mr. Webster: The hon. Member says "Cheap", but the former Minister of Transport is well known to have sought to get control of distribution and production. In terms of the distribution of people in the public transport authorities, it was her intention to set up Leviathans to gain control of the whole of the transport undertakings in those areas, and they themselves were to be controlled from Whitehall by methods which have been discussed both in Committee and in Report. They were to be controlled by the veto of the chairman, controlled by one-seventh of the members being appointed directly from Whitehall, and controlled by the right to withhold infra-structure grants.
In addition, these bodies would have had to precept their ratepayers for the railway deficits in their areas, which would have been very substantial. Without appeal, without objection and without compensation, they would have taken over the whole of the ratepayers' property in terms of transport—bus undertakings, vehicles and property. Nothing in this monstrous exercise would ensure that better conditions would be created for the travelling public.
Equally, the right hon. Lady sought to get control of the distribution of goods, in terms of quantity control. In that connection, one is thrown back repeatedly to what the Prime Minister said when he was appointed Leader of the Opposition in 1963 and went to Washington, where the Americans asked him—

Mr. Peter Mahon: On a point of order, Mr. Deputy Speaker. Has the Prime Minister's visit to Washington in 1963 anything to do with the magnificent concept which this Bill represents?

Mr. Depnty Speaker (Sir Eric Fletcher): This is a very large Bill and it covers a very wide area.

Mr. Webster: The answer to that point of order is, "Yes". The Prime Minister was asked whether he would nationalise the road haulage industry, as was done in 1947. He said:
We will not nationalise it as we did in 1947 and pay excessive compensation to every broken-dewn vehicle and every back-street garage. What we will do is to take the lid off the already nationalised British Road Services.

That is what the quantity control aspect has been designed to do, both by an increasing economic burden in the private sector, whether it is the existing A or C licences, and also by direction of the most valuable loads on to the railways, and on to the nationalised sector. It was to be nationalisation by bankruptcy, no doubt bankrupting the industry but equally, by giving increasing moneys to the British Transport Holding Company so that it could acquire the bankrupted private sector by the back door.
Again, with her Marxist beliefs, the former Minister wanted to get control of distribution and production in Clause 45, by giving to any of the nationalised industries the right to manufacture, distribute and sell any item to do with any of their industries. That, surely, is the second part of what Karl Marx insisted should be done.
Now we come to the end of the first Commons stage. Fifty Clauses in this massive contentious Measure have not been debated. It is the longest Bill ever to be put before Parliament. It has been guillotined time and time again. Representations on behalf of the industry and on behalf of our citizens have been cut short and, as a result, the House has been unable to give an adequate review to this disastrous Bill.
It is not for us to say what will happen in another place. However, in the context of what was the intention of the Bill and the manner in which it has been handled by the Government, there is obviously the closest need for a thorough review by a second Chamber. The stage is now set for that and for the constitutional consequences which might flow from it. One wonders, thinking of the Prime Minister, whether part of it is a deliberate attempt to stir up the constitutional issue between the two Houses. It is a matter which should be considered as the summer continues.
The consequences of it will be seen. There is a need to secure the discussion of these parts of the Bill that were not discussed in the House. There will be a need to ensure that Amendments are carried that were not carried in this House, some of which might well be substantial. Then it will be for Parliament to decide what is to be the future of the Bill and of Parliament, because


both the distributive industry and democracy itself are at great risk, and no one in Parliament today should ignore the challenge presented to it.
I urge my hon. Friends to throw out the Bill on Third Reading.

11.38 a.m.

The Minister of State, Ministry of Transport (Mr. Stephen Swingler): Like the hon. Member for Bodmin (Mr. Bessell), the hon. Member for Weston-super-Mare (Mr. Webster) started his speech by making a generous reference to my responsibilities during the course of the Bill's passage through the House. I am grateful to them for their kind words, though the rest of their speeches made it plain that this was not in any way a process of political conversion.
Whatever may be thought of my performance in the course of our proceedings, I would have found it quite impossible had I not been sustained and stimulated by a large number of people. I know that it is unusual in the House to do this, but I would mention, first, my Parliamentary Private Secretary, the hon. Member for Bristol, North-West (Mr. Ellis), who has been in constant attendance and whose unfailing advice has served me very well. Second, I should mention my advisers, who have toiled hard and long, literally night and day, dealing with the multitude of inquiries made of them. Third, I want to mention the Chairman of the Standing Committee, whose unfailing courtesy and kindness to all of those who went through the 191¼ hours of our proceedings contributed very much to our debates. Fourth, I would refer to my colleagues on this side of the House who gave unstinted loyal support, to which from time to time was added their constructive criticism and advice. Finally, I pay tribute to my critics and opponents. It may be that I would not have acquired during the past week all the instincts for survival that I now have had it not been for their provocative attitude. I owe them a debt, too.
Echoing The Times of the other day—I know that my right hon. Friend would wish me to do this—I would like to pay tribute to my right hon. Friend the Secretary of State for Employment and Productivity. The Times said, in a typically critical article, that the nation

owed her a debt of gratitude for this Bill. My right hon. Friend initiated it, and had the audacity to grasp the nettle —just as she had the audacity to introduce the breathalyser—in face of a great deal of criticism and unpopularity. That measure, I think, worked, or at any rate is working. So I think that her part in this Bill should be recalled now.
Any transport Bill worth the name in modern times is bound to be massive and highly controversial as this Bill is, because such is the clash of interests, such the sectional pressures and prejudices, and such the need for more accurate information, scientific study and especially cost-benefit analysis in the transport world, that any transport Bill worth the name is bound to be highly controversial.
On my calculation, we have taken 245 hours since the end of January on the Bill. The hon. Member for Worcester (Mr. Peter Walker) complains that it was not enough. I believe that all critics and opponents of future transport Measures will complain that the time spent on them will not be enough because it is the nature of the Opposition that for some kinds of the measure they demand infinite time to discuss them in the hope of killing them.
That is why hon. Members opposite felt it necessary to guillotine the 1962 Bill,. That is why there has been a long series of such occasions. There comes however, a time for decision, and Parliament must come to a conclusion on the sort of transport policy and transport laws it wants. The 245 hours we have spent since January have been long hours which have covered a very wide range of the subject matters in the measure.
Secondly, I believe that a reason why any transport Measure is bound to be massive is that all its parts, as in this Bill, are inter-related. The hon. Member for Bodmin (Mr. Bessell) was wrong in suggesting that the parts of the Bill should be produced as separate measures, as if they could be adequately and properly discussed in isolation one from another. What is contained in this Bill, a policy for reorganising the railways which gives them a different financial and organisational structure, for introducing an integrated freight service involving a reorganisation of our nationalised enterprises, for the reform of the licensing system, for the establishment of passenger transport


authorities in our cities, and for giving wider traffic powers to local authorities —all these subjects are inter-related.
It is not possible, as we endeavoured to show in the White Papers we issued, to divorce one from another. They interact upon each other. We have aimed here, and this Bill represents the endeavour, to get the integration that we need. People have been talking for so long about this, but very few measures have been taken to implement it. We inherited a disintegrated state of affairs as a result of the 1962 Act.
We faced a situation of mounting congestion in our cities. We faced a situation, as my right hon. Friend said, where impossible remits had been given to so many of the nationalised enterprises. Therefore, all these parts of the Bill, which can all be easily sectionally opposed if considered in isolation as our proceedings have shown—quantity licensing, quality licensing, P.T.A.s, and so on—must be related one to the: other because they are part of an integrated plan to provide this country with a transport system that will really serve the community.
Therefore, I reject the complaints made by the hon. Member for Weston-super-Mare and the hon. Member for Worcester about the lack of time. I support what my right hon. Friend said when opening this debate. I do not think that the Opposition have made very intelligent use of the time in discussion of these parts of the Bill. That is understandable, because while there is in the Bill a strong sense of priorities there is no correspondingly strong sense of priorities in the Opposition. It is quite understandable that an in-

ordinate amount of time has been given to discussing relatively trivial matters in the Bill, at the expense of the amount of time which might otherwise have been given to some of the major policies involved in it.

That has not been our responsibility. More time has been given to this Measure than I believe to any other that has been introduced. [An HON. MEMBER: "It is the longest."] I said that a transport Bill worth the name is bound to be a massive Measure, is bound, also, to be highly controversial. More time has been devoted to it, a record number of columns of HANSARD have been filled with the contributions to our debates, and I believe that, at the end of the day, the Bill will be recognised as an important milestone on the way to establishing in Britain the integrated transport system which we need.

Question put, That the Bill be now read the Third time:—

The House proceeded to a Division—

Mr. Roy Roebuck: (seated and covered): On a point of order, Mr. Deputy Speaker. I draw your attention to the fact that I have been unable to get into the Division Lobby owing to the congestion of traffic in Parliament Square? Is it not possible, in these circumstances, to call a new Division?

Mr. Deputy Speaker: I am sorry to hear that the hon. Gentleman was inconvenienced, but it is not possible, for the reason he has given, to call another Division.

The House divided: Ayes 265, Noes 225.

Division No. 205.]
AYES
[11.46 a.m.


Abse, Leo
Booth, Albert
Conlan, Bernard


Albu, Austen
Bottomley, Rt. Hn. Arthur
Corbet, Mrs. Freda


Allaun, Frank (Salford, E.)
Boydon, James
Craddock, George (Bradford, S.)


Alldritt, Walter
Braddock, Mrs. E. M.
Crawshaw, Richard


Anderson, Donald
Bradley, Tom
Crosland, Rt. Hn. Anthony


Archer, Peter
Brooks, Edwin
Crossman, Rt. Hn. Richard


Armstrong, Ernest
Broughton, Dr. A. D. D.
Cullen, Mrs. Alice


Atkins, Ronald (Preston, N.)
Brown, Rt. Hn. George (Belper)
Dalyell, Tam


Atkinson, Norman (Tottenham)
Brown, Hugh D. (G'gow, Provan)
Davidson, Arthur (Accrington)


Bacon, Rt. Hn. Alice
Brown,Bob(N'c'tle-upon-Tyne, W.)
Davies, Ednyfed Hudson (Conway)


Bagier, Gordon A. T.
Brown, R. W. (Shoreditch &amp; F'bury)
Davies, G. Elfed (Rhondda, E.)


Barnes, Michael
Buchan, Norman
Davies, Dr. Ernest (Strctford)


Barnett, Joel
Buchanan, Richard (G'gow, Sp'burn)
Davies, Harold (Leek)


Baiter, William
Butler, Mrs. Joyce (Wood Green)
Davies, Ifor (Gower)


Benn. Rt. Hn. Anthony Wedgwood
Callaghan, Rt. Hn. James
Delargy, Hugh


Bennett, Jamss (G'gow, Bridgeton)
Cant, R. B.
Dell, Edmund


Bidwell, Sydney

Carmichael, Neil
Dempsey, James


Binns, John
Carter-Jones, Lewis
Dewar, Donald


Bishop, E. S.
Castle, Rt. Hn. Barbara
Diamond, Rt. Hn. John


Blackburn, F.
Chapman, Donald
Dickens, James


Blenkinsop, Arthur
Coe, Denis
Dobson, Ray


Boardman, H, (Leigh)
Coleman, Donald
Doig, Peter




Driberg, Tom
Judd, Frank
Peart, Rt. Hn. Fred


Dunn, James A.
Kelley, Richard
Pentland, Norman


Dunnett, Jack
Kerr, Russell (Feltham)
Perry, Ernest C. (Battersea, S.)


Dunwoody, Mrs. Gwyneth (Exeter)
Lawson, George
Perry, George H. (Nottingham, S.)


Dunwoody, Or. John (F'th &amp; C'b'e)
Leadbitter, Ted
Prentice, Rt. Hn. R. E.


Eadie, Alex
Ledger, Ron
Price, Thomas (Westhoughton)


Edelman, Maurice
Lee, John (Reading)
Price, William (Rugby)


Edwards, Robert (Bilston)
Lestor, Miss Joan
Probert, Arthur


Edwards, William (Mrioneth)
Lewis, Arthur (W. Ham, N.)
Pursey, Cmdr. Harry


Ellis, John
Lewis, Ron (Carlisle)
Randall, Harry


English, Michael
Lomas, Kenneth
Rankin, John


Ennals, David
Loughlin, Charles
Rees, Merlyn


Fitch, Alan (Wigan)
Lyon, Alexander W. (York)
Reynolds, G. W.


Fletcher, Ted (Darlington)
Lyons, Edward (Bradford, E.)
Richard, Ivor


Foot, Rt. Hn. Sir Dingle (Ipswich)
Mabon, Dr. J. Dickson
Robertson, John (Paisley)


Foot, Michael (Ebbw Vale)
McBride, Neil
Robinson,Rt.Hn.Kenneth(St.P'c'as)


Forrester, John
McCann, John
Robinson, W. O. J. (Waith'stow, E.)


Fowler, Gerry
MacColl, James
Rodgers, William (Stockton)


Fraser, John (Norwood)
MacDermot, Niall
Rogers, George (Kensington, N.)


Freeson, Reginald
Macdonald, A. H.
Rose, Paul


Gardner, Tony
McGuire, Michael
Ross, Rt. Hn. William


Garrett, W. E.
McKay, Mrs. Margaret
Ryan, John


Gourlay, Harry
Mackenzie, Gregor (Rutherglen)
Shaw, Arnold (llford, S.)


Gray, Dr. Hugh (Yarmouth)
Mackintosh, John P.
Sheldon, Robert


Greenwood, Rt. Hn. Anthony
Maclennan, Robert
Shore, Rt. Hn. Peter (Stepney)


Gregory, Arnold
McMillan, Tom (Glasgow, C.)
Short, Rt.Hn.Edward(N'c'tle-u-Tyne)


Grey, Charles (Durham)
McNamara, J. Kevin
Silkin, Rt. Hn. John (Deptford)


Griffiths, David (Rother Valley)
MacPherson, Malcolm
Silverman, Julius (Aston)


Griffiths, Rt. Hn. James (Llanelly)
Mahon, Peter (Preston, S.)
Slater, Joseph


Griffiths, Will (Exchange)
Mallalieu, E. L. (Brigg)
Snow, Julian


Gunter,Rt.Hn R. J.
Mallalieu,J.P.W.(Huddersfield,E.)
Spriggs, Leslie



Hamilton, William (Fife, W.)
Manuel, Archie
Stewart, Rt. Hn. Micheal


Hamling, William
Marks, Kenneth
Strauss, Rt. Hn. G. R.


Hannan, William
Marquand, David
Summerskill, Hn. Dr. Shirley


Harrison Walter (Wakefield)
Marsh, Rt. Hn. Richard
Swain, Thomas


Haseldine Norman
Mason, Rt. Hn. Roy
Swingler, Stephen


Hazell Bert
Mellish, Rt. Hn. Robert
Symonds, J. B.


Healey, Rt. Hn. Denis
Mendelson, J. J.
Taverne, Dick


Henig, Stanley
Mikardo, Ian
Thomas, Rt. Hn. George


Hilton W S
Millan, Bruce
Thomson, Rt. Hn. George


Hobden, Dennis (Brighton, X' town)
Miller, Dr. M. S.
Thornton, Ernest


Hooley Frank
Milne, Edward (Blyth)
Tinn, James


Hought'on, Rt. Hn. Douglas
Mitchell, R.C. (S'th'pton, Test)
Tomney, Frank


Howarth, Harry (Wellingborough)
Molloy, William
Urwin, T. W.


Howarth, Robert (Bolton, E.)
Morgan, Elystan (Cardiganshire)
Varley, Eric G.


Howell Denis (Small Heath)
Morris, Alfred (Wythenshawe)
Wainwright, Edwin (Deame Valley)


Howie, W.
Morris, Charles R. (Openshaw)
Walker, Harold (Doncaster)


Hoy, James
Morris, John (Aberavon)
Watkins, David (Consett)


Huckfield, Leslie
Moyle, Roland
Watkins, Tudor (Brecon &amp; Radnor)


Hughes, Rt. Hn. Cledwyn (Anglesey)
Murray, Albert
Wellbeloved, James


Hughes, Emrys (Ayrshire, S.)
Neal, Harold
Whitaker, Ben


Hughes, Hector (Aberdeen, N.)
Newens, Stan
white, Mrs. Eirene


Hughes, Roy (Newport)
Oakes, Gordon
Whitlock, William


Hunter, Adam
Ogden, Eric
Williams, Alan (Swansea, W.)


Hynd, John
O'Malley, Brian
Williams, Alan Lee (Hornchurch)


Irvine, Sir Arthur (Edge Hill)
Oram, Albert E.
Williams, Clifford (Abertillery)


Jackson, Colin (B'h'se &amp; Spenb'gh)
Orme, Stanley
Williams, Mrs. Shirley (Mitchin)


Jackson, Peter M. (High Peak)
Oswald, Thomas
Willis, Rt. Hn. George


Janner, Sir Barnett
Owen, Dr. David (Plymouth, S'tn)
Wilson, Rt. Hn. Harold (Huyton)


Jay, Rt. Hn. Douglas
Owen, Will (Morpeth)
winnick, David


Jeger, George (Goole)
Paget, R. T.
Woodburn, Rt. Hn. A.


Jenkins, Hugh (Putney)
Palmer, Arthur
Woof, Robert


Jenkins, Rt. Hn. Roy (Stechford)
Pannell, Rt. Hn. Chares
Yates, Victor


Johnson, Carol (Lewisham, S.)
Park, Trevor



Johnson, James (K'ston-on-Hull W.)
Parkyn, Brian (Bedford)
TELLERS FOR THE AYES:


Jones, J. Idwal (Wrexham)
Pavitt, Laurence
Mr. J. D. Concannon and


Jones, T. Alec (Rhondda, West)
Pearson, Arthur (Pontypridd)
Mr. loan L. Evans




NOES


Allson, Michael (Barkston Ash)
Bessell, Peter
Brewis, John


Allason, James (Hemel Hempstead)
Biffen, John
Brinton, Sir Tatton


Astor, John
Biggs-Davison, John
Brown, Sir Edward (Bath)


Atkins, Humphrey (M't'n &amp; M'd'n)
Birch, Rt. Hn. Nigel
Bruce-Gardyne, J.


Awdry, Daniel
Black, Sir Cyril
Bryan, Paul


Baker, Kenneth (Acton)
Blaker, Peter
Buchanan-Smith,Alick(Angus,N&amp; M)


Baker, W. H. K. (Banff)
Boardman, Tom (Leicester, S.W.)
Buck, Antony (Colchester)


Balniel, Lord
Body, Richard
Bullus, Sir Eric


Batsford, Brian
Bossom, Sir Clive
Burden, F. A.


Bell, Ronald
Boyd-Carpenter, Rt. Hn. John
Campbell, Gordon


Bennett, Dr. Reginald (Got. &amp; Fhm)
Boyle, Rt. Hn. Sir Edward
Carr, Rt. Hn. Robert


Berry, Hn. Anthony
Braine, Bernard
Cary, Sir Robert







Channon, H. P. G.
Higgins, Terence L.
Peyton, John


Chichester-Clark, R.
Hiley, Joseph
Pike, Miss Mervyn


Clark, Henry
Hill, J. E. B.
Pink, R. Banner


Clegg, Walter
Hogg, Rt. Hn. Quintin
Pounder, Rafton


Cooke, Robert
Holland, Philip
Price, David (Eastleigh)


Cooper-Key, Sir Neill
Hordern, Peter
Prior, J. M. L.


Costain, A. P.
Hornby, Richard
Pym, Francis


Craddock, Sir Beresford (Spelthorne)
Howell, David (Guildford)
Quennell, Miss J. M.


Crosthwaite-Eyre, Sir Oliver
Hunt, John
Ramsden, Rt. Hn. James


Crouch, David
Hutchison, Michael Clark
Rawlinson, Rt. Hn. Sir Peter


Crowder, F. P.
Irvine, Bryant Godman (Rye)
Renton, Rt. Hn. Sir David


Cunningham, Sir Knox
Jenkin, Patrick (Woodford)
Rhys Williams, Sir Brandon


Currie, C. B. H.
Jennings, J. C. (Burton)
Ridley, Hn. Nicholas


Dalkeith, Earl of
Johnston, Russell (Inverness)
Rodgers, Sir John (Sevenoaks)


Dance, James
Jones, Arthur (Northants, S.)
Royle, Anthony


Davidson, James (Aberdeenshire, W.)
Kaberry, Sir Donald
Russell, Sir Ronald


d'Avigdor-Goldsmid, Sir Harry
Kerby, Capt. Henry
St. John-Stevas, Norman


Dean, Paul (Somerset, N.)
Kershaw, Anthony
Scott, Nicholas


Deedes, Rt. Hn. W. F. (Ashford)
Kimball, Marcus
Scott-Hopkins, James


Digby, Simon Wingfield
King, Evelyn (Dorset, S.)
Sharpies, Richard


Dodds-Parker, Douglas
Kirk, Peter
Shaw, Michael (Sc'b'gh &amp; Whitby)


Doughty, Charles
Kitson, Timothy
Silvester, Frederick


Douglas-Home, Rt. Hn. Sir Alec

Knight, Mrs. Jill
Sinclair, Sir George


Drayson, G. B.
Lambton, Viscount
Smith, Dudley (W'wick&amp;L'mington)


Eden, Sir Jhn
Lancaster, Col. C. G.
Smith, John (London &amp; W'minster)


Elliot, Capt. Walter (Carshalton)
Lane, David
Speed, Keith


Elliott, R W. (N'c'tle-upon-Tyne,N.)
Legge-Bourke, Sir Harry
Stainton, Keith


Emery, Peter
Lewis, Kenneth (Rutland)
Steel, David (Roxburgh)


Errington, Sir Eric
Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield)
Stodart, Anthony


Farr, John
Lloyd, Ian (P'tsm'th, Langstone)
Stoddart-Scott, Col. Sir M. (Ripon)


Fisher, Nigel
Lloyd Rt. Hn. Selwyn (Wirral)
Tapsell, Peter


Fletcher-Cooke, Charles
Lubbock, Eric
Taylor, Sir Charles (Eastbourne)


Fortescue, Tim
McAdden, Sir Stephen
Taylor,Edward M.(G'gow,Cathcart)


Foster, Sir John
MacArthur, Ian
Taylor, Frank (Moss Side)


Fraser,Rt.Hn.Hugh (St'fford &amp; Stone)
Maclean, Sir Fitzroy
Teeling, Sir William


Galbraith, Hn. T. G.
McMaster, Stanley
Temple, John M.


Gibson-Watt, David
Macmillan, Maurice (Farnham)
Thatcher, Mrs. Margaret


Giles, Rear-Adm. Morgan
Maddan, Martin
Thorpe, Rt. Hn. Jeremy


Gilmour, Ian (Norfolk, C.)
Maginnis, John E.
Turton, Rt. Hn. R. H.


Gilmour, Sir John (Fife, E.)
Marples, Rt. Hn. Ernest
Van Straubenzee, W. R.


Godber, Rt. Hn. J. B.
Glyn, Sir Richard




Mawby, Ray
Vaughan-Morgan, Rt. Hn. Sir John


Goodhart, Philip
Mills, Peter (Torrington)
Vickers, Dame Joan


Goodhew, Victor
Mills, Stratton (Belfast, N.)
Walker, Peter (Worcester)


Gower, Raymond
Miscampbell, Norman
Walker-Smith, Rt. Hn. Sir Derek


Grant, Anthony
Mitchell, David (Basingstoke)
Wall, Patrick


Grant-Ferris, R.
Monro, Hector
Walters, Dennis


Gresham Cooke, R.
Montgomery, Fergus
Weatherill, Bernard


Grieve Percy
Morgan, Geraint (Denbigh)
Webster, David


Griffiths, Eldon (Bury St. Edmunds)
Morrison, Charles (Devizes)
Wells, John (Maidatone)


Crimord Rt. Hn. J.
Mott-Radclyffe, Sir Charles
Whitelaw, Rt. Hn. William


Gurden, Harold
Munro-Lucas-Tooth, Sir Hugh
Williams, Donald (Dudley)


Hall-Davis, A. G. F.
Murton, Oscar
Wills, Sir Gerald (Bridgwater)


Hamilton, Michael (Salisbury)
Neave, Airey
Wilson, Geoffrey (Truro)


Harris, Frederic (Croydon, N.W.)
Nicholls, Sir Harmar
Winstanley, Dr. M. P.


Harrison, Brian (Maldon)
Noble, Rt. Hn. Michael
Wolrige-Gordon, Patrick


Harrison, Co. Sir Harwood (Eye)
Nott, John
Wood, Rt. Hn. Richard


Harvey, Sir Arthur Vere
Onslow, Cranley
Woodnutt, Mark


Harvie Anderson, Miss
Orr, Capt. L. P. S.
Worsley, Marcus


Hastings, Stephen
Orr-Ewing, Sir Ian
Wylie, N. R.


Hawkins, Paul
Page, Graham (Crosby)
Younger, Hn. George


Hay, John
Page, John (Harrow, W.)



Heald, Rt. Hn. Sir Lionel
Pardoe, John
TELLERS FOR THE NOES:


Heath, Rt. Hn. Edward
Pearson, Sir Frank (Clitheroe)
Mr. Jasper More and


Heseltine, Michael
Peel, John
 Mr. Reginald Eyre

Bill accordingly read the Third time, and passed.

The Business having been concluded, Mr. DEPUTY SPEAKER adjourned the

House without Question put, pursuant to Order.

Adjourned at two minutes to Twelve o'clock a.m.

Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

PRIVATE BUSINESS

THAMES VALLEY WATER BILL

Lords Amendments considered and agreed to.

Oral Answers to Questions — OVERSEAS DEVELOPMENT

East Africa (Development Division)

Mr. Hooley: asked the Minister of Overseas Development if he will set up a development division in East Africa.

The Parliamentary Secretary to the Ministry of Overseas Development (Mr. Albert E. Oram): It is not our present intention to set up a Development Division in East Africa.

Mr. Hooley: Is the Minister aware that the Development Division in the Middle East is held in very high regard and has done valuable work, notwithstanding the political conflicts there? Is he also aware that the Development Division in the West Indies is working extremely well? Could he give further consideration to the possiblity of this technique being used in Africa?

Mr. Oram: I certainly agree that the two Development Divisions are doing excellent work, and we hope to set up other Divisions in appropriate circumstances. I doubt whether the circumstances in East Africa make it either possible or desirable to set up a Development Division there at this moment, particularly having regard to the fact that countries in East Africa have retained a good number of expatriate officers in their service, and our High Commissions there

are reasonably well staffed. Moreover, our advisory staff in London are able to keep in close touch with local conditions.

Technology

Mr. Hooley: asked the Minister of Overseas Development what studies his Department is making of the development of intermediate technology as an aid to developing countries.

Mr. Oram: The Tropical Products Institute, which is one of the Ministry's technical branches, has for many years been advising developing countries on the use of appropriate technology for the development of indigenous industries, and is itself developing new processes or equipment where appropriate ones are not available. Advisory and development work on agricultural machinery is being done at the Ministry's expense by the Overseas Liaison Unit of the National Institute of Agricultural Engineering. We are in close touch in a number of ways with the Intermediate Technology Development Group.

Mr. Hooley: I welcome that reply. Is the Minister aware that there is a school of opinion which believes that this is a valuable form of aid to developing countries, which could also be of benefit to our own companies who are exporting small tools, and so forth?

Mr. Oram: Yes, I am well aware of this school of opinion, and my right hon. Friend and I had a meeting with leading personalities in the Intermediate Technology Development Group only this week.

Private Capital Investment

Mr. Biggs-Davison: asked the Minister of Overseas Development what study he has made of the reasons for the drop in the volume of British private capital invested in developing countries during 1966 when compared to 1965; and if he will make a statement.

The Minister of Overseas Development (Mr. Reg Prentice): It is not possible to discern a trend on the basis of two years' figures, but about one-third of the decline was due to fluctuations in oil and portfolio investment. The 1966 figure is still provisional, and the detailed country


analysis of direct investment which would be necessary for a study is not available.

Mr. Biggs-Davison: Is not one of the major causes of this decline the lack of insurance against political risks? Will the Minister say with how many countries we now have treaties for the protection of private investments? Is it still only one country?

Mr. Prentice: I need notice of the latter part of the question in order to give a figure. On the earlier part of the question, political disturbances, sometimes with violence, have been a factor in this. The hon. Member is making a comparison with 1965, which was a higher year than the preceding years. It would probably be more objective to take a longer view of the problem.

Mr. Braine: Is it not the fact that this country is almost alone among advanced industrial countries in not having a system of insurance against political risk? Does not the right hon. Gentleman feel that it is high time for the Government to take another look at this?

Mr. Prentice: That is a question for my right hon. Friend the President of the Board of Trade. We have to bear in mind the present balance of payments problems and the difficulties of giving new direct incentives to individual overseas investment at this stage.

South Yemen Republic

Mr. Biggs-Davison: asked the Minister of Overseas Development if he will make a further satement about the progress of negotiations on aid to the South Yemen Republic.

Mr. Prentice: As my hon. Friend the Parliamentary Under-Secretary for Foreign Affairs informed the House on 13th May—[Vol. 764, c. 182–3], negotiations with the Southern Yemen Government broke down on 10th May when that Government rejected our offer of further aid. We shall therefore be giving no further financial aid to South Yemen beyond the £12 million interim aid agreed at the Geneva negotiations last November.

Mr. Biggs-Davison: Is the Minister aware that I am glad that these negotiations have broken down, and is he further

aware that the people of this country think that these people have no moral claim upon them?

Mr. Prentice: I had guessed that the hon. Gentleman would be glad. We were, of course, obliged under the Geneva Agreements to hold these further discussions. I think that we can now say that we have discharged that obligation.

Mr. Hooley: Is my right hon. Friend aware that for 150 years, this country exploited the facilities of Aden for the benefit of our Fleet, shipping and Imperial interests? Would he not agree that, whatever the misfortunes which have occurred in recent years, which I regret as much as any other hon. Member, there may still be some moral obligation to the people of that part of the world?

Mr. Prentice: My own attitude to this matter has been governed neither by that point of view exactly, nor that of the hon. Member for Chigwell (Mr. Biggs-Davison). I have been concerned, as I have had to be, with the development potential here and the effective use to which aid might be put. In these matters, it is essential to look to the future rather than to the past. Bearing in mind all the considerations, our offer was a very modest one, and the negotiations broke down.

Scientists

Mr. Roebuck: asked the Minister of Overseas Development what steps he is taking, in view of the need to stimulate world food production, to encourage young scientists, particularly agricultural scientists, to prepare themselves for work in developing countries.

Mr. Oram: We now provide a comprehensive scheme of postgraduate studentships. It covers agricultural, veterinary and other natural resources subjects. Academic study and practical training can both be provided, in Britain or overseas. Recipients of these studentships are expected to work for several years afterwards in developing countries.

Mr. Roebuck: Is my hon. Friend aware that that answer will give great satisfaction to those of us who believe that the best way to help the developing countries is by teaching them to help themselves? Can he say how students


can obtain more information about the scheme, how many awards there are, and what is the amount of money involved?

Mr. Oram: I welcome the first part of my hon. Friend's supplementary question. As for finding out more about the scheme, we have prepared a special pamphlet which is being distributed to universities and other institutions. For the present year, up to 40 awards will be available, and this year's selection process is well under way. The estimated cost of this Natural Resources Scheme is £55,000 in the current financial year.

Mr. Scott-Hopkins: Can the hon. Gentleman say what help we are giving through the F.A.O. in Rome and its subsidiary organisations dealing with the developing countries?

Mr. Oram: We take a full part in the conferences and committees of the F.A.O., and we make a general subscription to its funds which is available for training.

British Industry (Consultation)

Mr. Braine: asked the Minister of Overseas Development what machinery exists for consultation with British industry at the planning stage before decisions are taken on the allocation of aid.

Mr. Prentice: It is not practicable to hold consultations with industry at the planning stage, but there are many contacts between my department and industry on matters concerning their interests. These interests are given full weight when aid allocations are planned.

Mr. Braine: Can the right hon. Gentleman give the House an assurance that the Government's admitted failure to consult British business interests over the compensatory aid arrangements for Singapore will not be repeated? Can he say what specific action is being taken by the Government to implement the recommendations of the Cromer Committee in this regard?

Mr. Prentice: We are considering carefully the recommendations of the Cromer Committee. I cannot make a statement on it at the moment. Certainly I do not admit a failure to consult industry over

Singapore and Malaysia. There have been a number of contacts, both in those countries and in this country, with the interests concerned.

Kenya (Land Valuation)

Mr. Wall: asked the Minister of Overseas Development if he will make a statement about the results of his Department's recent investigation of the market value of land in Kenya.

Mr. Oram: I regret I am not yet in a position to make a statement about this as the report of the British Government valuer is still under consideration by the Kenya Government and ourselves.

Mr. Wall: Is the hon. Gentleman aware that this is a matter of great importance, as market value is the basis of all land valuation in Kenya? Is he further aware that now that only Kenya citizens are allowed to buy or rent land there is considerable doubt whether there is a market value for small mixed farms?

Mr. Oram: I agree about the importance of this, and that is why an investigation has been made recently. However, I would ask the hon. Gentleman to await a more appropriate moment.

Mr. Turton: Can the hon. Gentleman give an assurance that all offers on the valuation of land under the Million Acre Scheme and the later scheme are made known to the British High Commission?

Mr. Oram: Yes, that is the position.

Swaziland

Mr. Wall: asked the Minister of Overseas Development what post-independence financial aid will be provided for Swaziland.

Mr. Oram: I would refer the hon. Member to the Reply my right hon. Friend gave him on the 11th April concerning British aid to Swaziland up to March, 1969—[Vol. 762; c. 1557.] We intend to hold talks with the Swaziland Government in the autumn to discuss the question of aid after March, 1969.

Mr. Wall: Can the hon. Gentleman confirm that these talks will be held before independence? Is it not a fact that this is what the Swazi Government have


been pressing for, and that it is in accordance with the precedents of other independent States in Southern Africa?

Mr. Oram: The date of the talks is under discussion, but a team from our Ministry will be going to Swaziland in July, which will be before independence, to have preliminary discussions about the future development plans of Swaziland.

Botswana

Mr. Judd: asked the Minister of Overseas Development what has been the value of capital, budgetary and technical assistance to Botswana in each of the past 10 years; and what it is estimated to be in 1968–69.

Mr. Oram: As a large number of figures are involved, I will, with permission, circulate details in the OFFICIAL REPORT. The figures show that our total aid to Botswana has increased from

BRITISH OFFICIAL DISBURSEMENTS OF BILATERAL ECONOMIC AID TO BOTSWANA—1958–59 — 1968–69





Financial Aid*


£ 'thousand




Development Projects









Grant
Loan
Budgetary Grant
Commutation and Compensation Loans §
Technical Assistance
Total


1958–59 
…
265†
25
560
—
†
850


1959–60
…
281†
40
650
—
†
971


1960–61
…
172†
413
970
—
†
1,555


1961–62 
…
411
236
1,155
—
94
1,896


1962–63
…
463
225
1,363
—
55
2,106


1963–64 
…
456
11
1,592
—
76
2,135


1964–65 
…
852
410
1,870
—
240
3,371


1965–66
…
1,010
568
2,660
—
237
4,474


1966–67
…
1,537
277
2,350
210
399
4,773


1967–68†
…
1,551
326
2,866
87
327
5,157


Total 
…
6,997
2,531
16,036
297
1,428
27,289


1968–69


(estimated)
…
1,230
25
3,560
166
384
5,365


Columns may not add exactly due to roundings.


✶ Includes overseas investment by the Commonwealth Development Corporation.


† Disbursements for technical assistance cannot be separately identified by country prior to 1961-62.


‡ Provisional


§ Loans to assist the Botswana Government in meeting its share of payments of compensation and commuted pensions to expatriate officers.

Egypt

Mr. Boyd-Carpenter: asked the Minister of Overseas Development what provisions; he intends to make this year for Egypt; and for what purpose.

Mr. Prentice: £750 for completing the training of a U.A.R. laboratory technician in the United Kingdom, plus the cost of any other requests for technical

£850,000 in 1958–59 to an estimated £5·3 million in 1968–69.

Mr. Judd: Is my hon. Friend aware of the current investigations into the considerable mineral resources of Botswana, and can he assure the House that Her Majesty's Government will see the country through to the exploitation of them so that the point of economic take-off can be reached as soon as possible?

Mr. Oram: I am aware that important copper deposits have been discovered in Botswana and that the United Nations Development Programme is at present undertaking a survey. It is a little premature to forecast the effect on Botswana's economy and, therefore, it is premature for me to be asked exactly for the guarantee which my hon. Friend seeks.

Following is the information:

assistance which we might agree to provide.

Mr. Boyd-Carpenter: While not quarel-ling with the trivial nature of these figures, does the right hon. Gentleman accept that it would be quite inappropriate to grant any appreciable aid to a country which is both unlawfully detaining British ships and planning military aggression against its neighbour?

Mr. Prentice: Considerations of that kind are taken into account along with others. Certainly it is not the present intention to provide any substantial financial aid programme to the U.A.R.

Mr. Shinwell: Does my right hon. Friend really believe that any aid granted to the Egyptians will make them less subservient to the Soviet Union? Is he aware that President Nasser has just announced that in July he is asking all his friends in the Arab States to get ready for another act of aggression against the State of Israel?

Mr. Prentice: Yes, Sir. As I said earlier, there is no intention to give any substantial financial aid to the U.A.R. The only kind of programme that we are engaged in is one of technical assistance on a very modest scale. I am sure that my right hon. Friend would not quarrel with that.

O.E.C.D. Development Assistance Committee (Meeting)

Mr. Bryant Godman Irvine: asked the Minister of Overseas Development what proposals were put forward by Her Majesty's Government at the meeting of the Development Assistance Committee of the Organisation for Economic Cooperation and Development held on 8th and 9th May.

Mr. Prentice: These Meetings are confidential to participants, and it is not customary to divulge the views expressed by individual members.

Mr. Godman Irvine: Can the Minister say what consideration has been given in the conversations between him and his right hon. Friend the Chancellor of the Exchequer to fiscal incentives for private investors? Can he say, further, what other proposals he has made for the consideration of arrangements between Government agencies and private investors?

Mr. Prentice: That goes rather wider than the Question. Certainly the meeting of the D.A.C. was concerned with private investment in developing countries, but it is not the practice to make a statement afterwards about the attitudes taken by the respective countries.

Devaluation

Mr. Gardner: asked the Minister of Overseas Development whether he is now able to assess the full effect of devaluation on United Kingdom aid to developing countries.

Mr. Prentice: I have nothing to add to the answers I gave on 18th January to my right hon. Friend the Member for Easington (Mr. Shinwell) and others.— [Vol. 756, c. 1929–32.]

Mr. Gardner: Does my right hon. Friend accept that the technical assistance part of his programme is probably the most vital part? Will he ensure that it is maintained at the previous level, regardless of the effects of devaluation on other parts of his programme?

Mr. Prentice: I have told the House already that inducement allowances to technical assistance personnel serving overseas have been adjusted to take account of devaluation. This was the major effect that devaluation would have had on that part of the programme. We have taken care of that.

Voluntary Service

Mr. Gardner: asked the Minister of Overseas Development what steps have been taken in the last year, in the context of both the British Volunteer Programme and the Voluntary Service Overseas Cadet Volunteer Programme, to interest both sides of industry in service overseas by volunteers.

Mr. Oram: Last year I had discussions with both sides of industry. These meetings have been followed up by the sending societies and the Ministry in various ways. Both the British Volunteer Programme and Voluntary Service Overseas's own cadet scheme have been brought to the attention of individual trade unions and industrial firms on several occasions.

Mr. Gardner: Can my hon. Friend enlarge a little further on that and say whether all these approaches have yet produced any change in recruitment?

Mr. Oram: The C.B.I. has given publicity to our volunteer programme in its education and training bulletins. Articles on volunteer service have appeared in a


number of trade union publications. The C.B.I. and the trade unions have been acquainted with the nature of the posts which it is hoped volunteers will fill. It is too early to give a full figure about recruitment from industry for the present year, but provisional information already indicates that there will be an increase over last year.

Mr. James Davidson: Will the hon. Gentleman say whether, in connection with a letter which I wrote to him recently about dissemination of information on overseas aid to schools when this comes about, he will take steps to improve this dissemination and other possibilities of careers for young people in overseas aid development?

Mr. Oram: We have debated this on previous occasions in the House. While I accept the spirit of the hon. Member's supplementary question, he should have in mind that volunteer service is mainly a matter for graduates from the universities. Sixth forms of schools are not necessarily the best places in which to do our recruiting. Universities are the places where we make a direct approach, but we convey as much information to schools as we can.

Mr. Blenkinsop: Does my hon. Friend agree that the non-graduate field is one of the most important and that what we want desperately is practical young men going for experience in industry?

Mr. Oram: Yes, Sir. I probably misled the House. I was distinguishing in my supplementary answer between universities and sixth forms. I entirely agree with what my right hon. Friend said about the need for industrial volunteers, people with qualifications which are equal to those of a graduate but of an industrial kind. It is in this field that we are making special efforts.

British Solomon Islands

Mr. Bryant Godman Irvine: asked the Minister for Overseas Development what allowance he has made for the effects of devaluation on aid to the British Solomon Islands Protectorate.

Mr. Oram: I have nothing to add to the Answer I gave to the hon. Member on 11th April.—[Vol. 762, c. 288.]

Mr. Godman Irvine: Is the hon. Gentleman satisfied that the money is being spent in the right way as in fact the exports are

still at the 1960 level and the deficit is 3½ million dollars?

Mr. Oram: I would require notice of the question about the exact way in which the money is being spent, but the Question relates to increase in aid to take account of devaluation. I assure the hon. Member that this has been taken care of.

Rodriques (Hurricane Disasters)

Mr. Henry Clark: asked the Minister of Overseas Development what special assistance this country has given the island of Rodrigues in its recent successive hurricane disasters.

Mr. Oram: In these sad circumstances Her Majesty's Government have given emergency relief amounting to £8,000 to help with the immediate problem. I have told our High Commissioner that I will consider sympathetically any proposal by the Mauritius Government for using some of our aid at present allocated to that country to meet the cost of longer term restoration work in Rodrigues.

Mr. Clark: Does not the recurrence of these disasters emphasise the need for some British naval presence in the Indian Ocean? Could the hon. Gentleman discuss this matter with the Minister of Defence?

Mr. Oram: That, of course, is not a matter for my Ministry, but I will call the attention of my right hon. Friend the Secretary of State for Defence to the supplementary question.

International Development Association (United States)

Mr. Henry Clark: asked the Minister of Overseas Development what estimate he has made of the effect the new arrangements, whereby the United States contribution to the International Development Association will be called on to meet disbursements on new credits only for the amount needed to finance procurement in the United States of America, will have on the level of British exports arising from International Development Association loans.

Mr. Prentice: I have no reason to believe that the level of British exports will be affected by these arrangements.

Mr. Clark: In view of the Minister's Answer on 14th March, it seems rather surprising that American aid will be tied.


Does the right hon. Gentleman still believe that every £ contribution of international aid will still result in 30s. of British exports, despite the tying of this contribution to I.D.A.?

Mr. Prentice: There is some misunderstanding here, which is not surprising in view of the complication of the subject, but the aid will not be tied. The arrangement is that American aid will be drawn down in the early stages at the rate of American procurement but the American commitment over three-year period will be the same. They will be able to postpone some of their contributions but they will come in later. This will have a relative effect on our exports in the earlier part of the period but we will catch up in the later part.

Singapore and Malaysia

Mr. Whitaker: asked the Minister of Overseas Development what aid is being offered to Singapore and Malaysia to help offset the effects of the planned withdrawal of the British forces.

Mr. Prentice: Her Majesty's Government have offered £50 million to Singapore and £25 million to Malaysia for commitment over the next five years. As much as possible of the aid will be directed to the provision of British goods and services. Initially expenditure will be met as necessary from the Civil Contingencies Fund and supplementary estimates will be presented to the House in due course.
Her Majesty's Government have also undertaken to hand over, without charge, all defence lands and fixed assets required by the two Governments for their economic or defence plans, together with any surplus non-operational movable equipment needed to maintain these assets as going concerns. These lands and assets will thereafter become the responsibility of the Governments concerned.

Mr. Whitaker: I thank my right hon. Friend for that reply. Is this aid coming out of the overall normal aid budget or is it additional?

Mr. Prentice: My Department will be responsible for this programme and the aid will be on our Vote, but it will be above the £205 million normal aid programme; it will be additional to that.

Mr. Braine: The right hon. Gentleman has just said that the bulk of this aid he hopes will be devoted to the provision of British goods and services. In the light of his previous Answer, can he tell the House at what stage there is consultation between his Department and British industry in this country and British commercial interests in Malaysia and Singapore?

Mr. Prentice: As I have already told the hon. Member, there has been a good deal of consultation already, and this will continue. There will also, of course, be direct discussions, in which we are engaging, between the Governments of Singapore and Malaysia and commercial interests. For example, the Prime Minister of Singapore, who has been in London for the last few days, has had meetings with the C.B.I. and other industrial interests.

Captain W. Elliot: Is no British lien to be maintained over these defence facilities, because these are very solid assets which we are giving away?

Mr. Prentice: That is a question for my right hon. Friend the Secretary of State for Defence.

U.N. Conference on Trade and Development

Dame Joan Vickers: asked the Minister of Overseas Development what action has so far been taken by Her Majesty's Government to implement the various plans put forward at the United Nations Conference on Trade and Development meeting in New Delhi.

Mr. Prentice: My right hon. Friend the President of the Board of Trade made a statement to the House on 8th April covering the outcome of the Conference as a whole, including the agreements on the aid target and supplementary finance, which are the responsibility of my Department. I am replying to a separate Question on the aid target. We intend to co-operate actively in the further work on the scheme for supplementary finance.—[Vol. 762, c. 887–92.]

Dame Joan Vickers: Will the right hon. Gentleman consider further cooperation with O.E.C.D. and the Council of Europe, because all these countries are making their separate plans and it


would be far more valuable if we coordinated them and saved overlapping in the various forms of aid we are making?

Mr. Prentice: Yes, we are doing that. A number of resolutions passed at the U.N.C.T.A.D. are now being considered by Her Majesty's Government and other Governments in the framework of the O.E.C.D.

Mr. Higgins: What is the Government's attitude to the commodity agreement proposals? Does the right hon. Gentleman regard the proposals for compensatory finance as an alternative for these proposals?

Mr. Prentice: Not as an alternative to the supplementary financial measures, but there will be a meeting of the intergovernmental group in October. On the commodity proposals, my right hon. Friend the President of the Board of Trade has answered Questions. Certainly Britain is; playing an active part in the discussions arising from the resolution on that point.

Food Growing Methods (Research)

Dame Joan Vickers: asked the Minister of Overseas Development, in view of the fact that a world shortage of food is probable by 1971, what action he is taking in regard to research into new methods of growing food, especially in and for tropical countries.

Mr. Oram: The Ministry is assisting research both in the United Kingdom and overseas into plant breeding and fertilisers, crop and animal husbandry, the control or elimination of pests and diseases in pre-harvest and post-harvest conditions, and related fields.

Dame Joan Vickers: Has the hon. Gentleman seen the O.E.C.D. Report by Mr. Christiansen, which gave very adequate statistics in relation to research in regard to new foods? What co-operation is the Ministry having on this?

Mr. Oram: I have not seen the report to which the hon. Lady refers, but I can assure her that we are spending £2 million on research in this field and are getting good, practical results. I will write to her about the report she has mentioned.

Mr. Molloy: While acknowledging the importance of scientific research in assisting developing countries to meet the problems of world food shortage, may I ask my hon. Friend to bear in mind that equal importance must be paid to trying to get young artificers, mechanics and others of that calibre to make their contribution in carrying out the proposals submitted from the scientists?

Mr. Oram: Yes. That is important. So far the volunteer scheme has largely been oriented towards universities and schools. I agree with my hon. Friend that agriculture generally is an important field for this kind of young person to take up service overseas, and we are doing all we can to encourage that.

U.N., Aid Programmes (National Targets)

Mr. Judd: asked the Minister of Overseas Development what is the size of the British aid and development programme in terms of the new United Nations Conference on Trade and Development definition for national targets.

Mr. Fisher: asked the Minister of Overseas Development by how much and by what date the United Kingdom's aid to under-developed countries will be increased as a result of the second United Nations Conference on Trade and Development in New Delhi.

Mr. Prentice: As I explained to the House in the debate on 7th May, we shall do our best to reach the new target as and when we can, although our first priority must be to strengthen our balance of payments. On the basis of current aid plans and a preliminary estimate of private flows, our current performance, when related to the latest figure for G.N.P. available—which is for the year 1967—is about 0·9 per cent.

Mr. Judd: Will my right hon. Friend state precisely how soon we shall be fulfilling the new target? Further, will he agree that there is a great deal of public misunderstanding about the true cost to our balance of payments of overseas assistance of this sort?

Mr. Prentice: I certainly agree with my hon. Friend on the last point. I cannot be specific about the date on which


we shall reach the new target. Obviously it depends on the progress which we make with our balance of payments. My hon. Friend will recall that the resolution committed us and other countries concerned to use our best endeavours to reach that target, but bearing in mind factors which affected our own economy.

Mr. James Davidson: When is the White Paper on the U.N.C.T.A.D. conference to be published?

Mr. Prentice: I think very soon.

Crown Agents

Dr. John Dunwoody: asked the Minister of Overseas Developement what are the functions of the Crown Agents in providing overseas aid.

Mr. Prentice: The Crown Agents do not themselves provide overseas aid. They provide purchasing and shipping services for their overseas principals, and these services often relate to goods and equipment supplied under British Government aid. The Crown Agents also act as Agents for the British Government where aid funds are used for gifts of British goods and equipment.

Dr. Dunwoody: Does not my hon. Friend agree that the very valuable work which the Crown Agents do in this field may well be damaged in the future if they continue to act as intermediaries in the supply of arms to the Nigerian Federal Government, many of those arms coming from foreign sources and being provided at the rate of about £1 million worth a month? Will he do all that he can to stop that?

Mr. Prentice: As I have explained, the Crown Agents act as agents for overseas Governments in purchases of many kinds. The policy of Her Majesty's Government on the shipment of arms was explained to the House by the Prime Minister on 16 th May and by the Commonwealth Secretary on 21st May.

Republic of Somalia

Mr. James Johnson: asked the Minister of Overseas Development what amount of technical assistance and aid he is proposing to give to the Republic of Somalia.

Mr. Prentice: Details have not yet been worked out. These must await the out-

come of discussion which recently took place in Somalia and also reports from my Chief Education Adviser and my Animal Health Adviser who are visiting Somalia in June.

Mr. Johnson: Will the Minister give an assurance this afternoon, whatever else he may do later, that he is at the moment taking the most urgent steps to see that we have a supply in the largest measure of teachers of the English language for the Somali people? Does he realise that that is the most important single step to be taken now that they have changed from Italian speaking, particularly in the south, to English speaking in all their schools and all their public institutions?

Mr. Prentice: We have that point very much in mind. As I told my hon. Friend, my Chief Education Adviser is to visit Somalia next month.

Oral Answers to Questions — TELEPHONE SERVICE

Shared Telephone Lines (Midlothian)

Mr. Eadie: asked the Postmaster-General (1) how many subscribers in Midlothian have shared telephone lines; and if he will list the numbers in each town or landward area;
(2) what steps are being taken in the county of Midlothian to offer subscribers on shared telephone lines the choice of their own telephone line.

The Assistant Postmaster-General (Mr. Joseph Slater): The information is not readily available in the form requested, but I will, with permission, circulate in the OFFICIAL REPORT the numbers of shared service subscribers in the exchange wholly or partly serving the County of Midlothian. As elsewhere in the country, we are providing additional cables to meet the demand for telephone service, and our aim is eventually to provide exclusive service for all who ask for it. As our resources are limited we are not yet able to achieve this as quickly as we should like.

Mr. Eadie: Will my hon. Friend tell me the circumstances by which a customer sharing a line may make application for an exclusive line? How does the


county of Midlothian compare with the rest of the country?

Mr. Slater: Customers may be given an exclusive line if they ask for it and if local conditions permit. Their liability again to share, should it be required, remains. Answering the second part of the question, 17·3 per cent. of the working connections are shared compared with a United Kingdom average of 18·9 per cent.

The information is as follows:


Exchange



Number of Shared Service Subscribers


Dalkeith 
…
…
…
260


Ford
…
…
…
32


Fountainhall
…
…
…
—


Gorebridge
…
…
…
32


Heriot
…
…
…
9


Lasswade
…
…
…
214


Livingston
…
…
…
29


Loanburn
…
…
…
75


Loanhead
…
…
…
45


Mid Calder
…
…
…
77


Musselburgh 
…
…
…
340


Newbattle
…
…
…
134


Penicuik
…
…
…
250


Pentland
…
…
…
164


Ratho
…
…
…
47


Roslin
…
…
…
79


Stow 
…
…
…
6


Temple
…
…
…
7


West Calder
…
…
…
73


Total 
…
…
…
1,873

Telephone Bills (Free Postage)

Mr. Ronald Bell: asked the Postmaster-General why subscribers are now asked to pay the postage when paying their telephone bills by post.

The Postmaster-General (Mr. Roy Mason): I am sorry that we had to stop sending postage-paid returnable envelopes to some of our subscribers. I am at the moment reconsidering policy generally on free postage on telephone bills.

Mr. Bell: I am obliged for that Answer, which will be generally welcomed. Is the right hon. Gentleman aware that the public do not like the fact that mechanisation always seems to operate to their disadvantage?

Mr. Mason: I remind the hon. and learned Gentleman that most corporations require their subscribers, when paying bills, to put postage stamps on them. So far we have avoided that.

Telephone Sales (Marketing Campaigns)

Mr. Stratton Mills: asked the Postmaster-General what steps the Post Office are taking to undertake selective marketing campaigns for the purpose of promoting telephone sales in areas where there is no shortage of equipment.

Mr. Mason: Some local experimental schemes which commenced during the past year are being continued, and I am at present considering comprehensive plans for extending our marketing activities.

Mr. Mills: Having regard to the very definite criticism of the Report of the National Board for Prices and Incomes, will the right hon. Gentleman give priority to strengthening the Post Office marketing staffs? When can we expect to see results from these local experiments?

Mr. Mason: We have had only a few pilot schemes so far, but it is our intention to step these up in the course of the autumn, and it is proposed to spend up to £1 million on real selling.

Directory Inquiry Calls

Mr. Bryan: asked the Postmaster-General by what criteria and by what grade of official it will be decided whether or not a charge is to be made for a directory enquiry call.

Mr. Mason: Only when the caller is unable to give reasonably adequate information on the wanted number to be traced and requires the operator to go to quite special lengths would a fee of 1s. become chargeable. The decision whether this special search should be made and the fee charged will rest with the customer.

Mr. Bryan: Will the caller be told if he is going to be charged? If he disagrees with the decision, what happens?

Mr. Mason: First, nearly 50 per cent. of the directory inquiries are made by people who have got the information in their own directories at the time. Secondly, 17 per cent. of directory inquiries are vague, which necessitates a search, and this constitutes 40 per cent. of the operator's work. It will be up to the customer. The operator will let him know that a search is required and that


It will take time. He will ask him whether he wants the search to go on, pointing out that if he does he will be charged for the time.

Mr. Ogden: Will my right hon. Friend offer the thanks and congratulations of many hon. Members to those who operate the inquiry service and who seem to have better detection facilities than many police forces?

Mr. Mason: I am obliged to my hon. Friend. They will be pleased to hear that compliment.

Dr. Winstanley: Directory inquiries cost not only money but labour. Will not the number of such calls depend on the satisfactory nature or otherwise of the directories issued to subscribers?

Mr. Mason: Directory inquiries cost nearly £7 million a year and we would like to encourage people to use their directories to the full instead of ringing the operator. Nearly 50 per cent. of the subscribers have the information they want in their own directories.

Mr. Dobson: Will my right hon. Friend look at this matter again? Breaching the old-established principle of not charging for directory inquiries means that he must be sure that the time an operator spends on a call of this kind is properly equated. If he is going past this barrier, he should look at how long an operator may spend talking to the customer about the chance of finding the information.

Mr. Mason: I am obliged for those comments. I remind the House that nearly all those who are to use directory inquiries will still be able to use the service free.

London Directories

Mr. Grimond: asked the Postmaster-General how many subscribers were asked their views before he decided to break the London telephone directory into 36 volumes.

Mr. Bryan: asked the Postmaster-General if he will give instructions for the present scale of directory distribution in the London area to be continued.

Mr. Goodhart: asked the Postmaster-General if he will now continue

the present organisation of the London telephone directory.

Mr. Moonman: asked the Postmaster-General what will be the policy in the proposed reorganisation scheme of the London telephone service regarding the use of directory inquiries; and what will be the charge per call for this service.

Mr. Mason: The proposals for London directories have been widely misinterpreted. We now have four inner London books and five outer London books. They are growing rapidly and by 1975 will be twice their present size. Their size is discouraging people from using them. The average Londoner makes most calls in his borough and its surrounding areas, and to places such as public services, department stores and places of entertainment. We think we can improve the present system. We have made a start with the Gerater London Business Directory which lists businesses throughout Greater London. We now propose 36 directories to replace the present nine, each covering a London borough and a wide surrounding area. Each book will also include 5,000 of the most frequently wanted numbers from all over London. If a customer wants a book of another district of London he can have it, free. He can hold them all if he wants to. One book will cover the City and the West End and will undoubtedly be popular. Backing this system will be the directory enquiry service, free unless the caller has inadequate information. There will be some firms and people who need information about every subscriber throughout London. For them we shall produce an integrated list of all subscribers in Greater London.
We have already discussed the plan with the Post Office Users' Council, the Greater London Council, the London Boroughs Association, and the London Chamber of Commerce, and received general support. I propose to have an independent survey of public opinion before reaching an irrevocable decision.

Mr. Bryan: The right hon. Gentleman has just said that he intends to have an inquiry into public opinion before he takes a final decision. Is he really telling us that he is still in doubt as to what public opinion is on this subject? I


understand that the present set of directories—the comprehensive set—costs £1 1s.

Mr. Speaker: Order. Questions must be reasonably brief.

Mr. Bryan: I will be brief, Mr. Speaker. The present set cost £1 1s. in total and I understand that the new set of 36 books cost 4s. each, which comes to £7 4s. Where does the economy come in?

Mr. Mason: The rather shallow opinion polls carried out recently were about the present system. We are talking about a system which is to be evolved and ready in four years time. We want to be able to talk particularly to residential subscribers about how they feel about the fact that the directories will grow in size and how best they think they could use them. The idea is to provide subscribers with a tailor-made directory purposely designed. Incidentally, we do not charge for directories. They are free.

Mr. Goodhart: Does not the right hon. Gentleman realise that the proposed reorganisation of the directories will coincide with the introduction of all-number dialling in London, thus presenting telephone users with a double calamity? If he had been able to keep it secret—instead it was revealed by the Press—when did the right hon. Gentleman plan to tell the public about this lamentable scheme?

Mr. Mason: The hon. Gentleman is intervening in a subject of which he knows little. If he had read last year's Post Office Accounts he would have known that this scheme was referred to there and particularly by the Post Office Users' Council.

Oral Answers to Questions — WIRELESS AND TELEVISION

Broadcasting Licence Fee

Mr. Stratton Mills: asked the Postmaster-General whether he will make a statement about the future of the broadcasting licence fee.

Mr. Mason: I have no statement to make at present.

Mr. Mills: Have the B.B.C. submitted to the right hon. Gentleman a request for an increase in the licence fee? If

so, by how much? Will he give an assurance that no increase will take place without full submission to the National Board for Prices and Incomes?

Mr. Mason: I do not think that it is necessary to refer it to the National Board for Prices and Incomes. If the licence fee were increased, it would be a tax increase and, therefore, it would not be necessary to refer it. But we should consider that issue once the decision had been made. Both the previous Conservative Administration and ourselves have been constantly aware of what the B.B.C. require because of the developments which both the previous Administration and ourselves have encouraged.

Mr. Bryan: Will the Postmaster-General explain that again? The public will be very worried indeed when and if the licence fee is increased. Does he not feel that a reference to the National Board for Prices and Incomes would be useful in that respect?

Mr. Mason: As I told the hon. Gentleman only two weeks ago, I will consider that more fully once we have made a decision on this matter.

Mr. Dickens: Will the Postmaster-General confirm that the British licence fee for radio and television broadcasting is the lowest in Western Europe and provides perhaps the most comprehensive service of any public authority in Western Europe?

Mr. Mason: With the exception of Holland, it is probably £2 cheaper than in any other Western European country.

Oral Answers to Questions — POST OFFICE

Sub-Offices (Anti-Bandit Screens)

Mr. Hunt: asked the Postmaster-General when he expects to be able to make his further statement of Post Office policy regarding the provision of anti-bandit screens in all sub-post offices.

Mr. Mason: I am discussing the whole matter with the National Federation of Sub-Postmasters at present and until these discussions are concluded I regret that I am not in a position to make a further statement, but I hope to be able to do so shortly.

Mr. Hunt: In the meantime, will the Postmaster-General recall that he recently told a sub-postmaster in my constituency who has been the victim of a particularly vicious assault that the question of safety was one which he was taking very much to heart? In that case, when will his heart persuade him to be a little more generous?

Mr. Mason: I hope that the hon. Member appreciates that I am not being bound by my predecessor's decision but am reviewing the matter. I am reviewing it sympathetically, and I hope that I can make a statement shortly after the Recess.

Mr. W. Baxter: Is the Postmaster-General aware that we should like him to be as urgent as possible in this matter because considerable concern is being felt by sub-postmasters about this problem?

Mr. Mason: I have taken the first step and I am awaiting the replies of the Sub-postmasters' Federation to my offer.

EUROPEAN ECONOMIC COMMUNITY

Sir Knox Cunningham: asked the Prime Minister whether, in view of recent developments in Germany, he will now withdraw the United Kingdom application to join the Common Market.

The Prune Minister (Mr. Harold Wilson): No, Sir.

Sir Knox Cunningham: Has not the basis of the Common Market been affected by events in France as well as in Germany? Does not the right hon. Gentleman agree that for him to say that New Zealand butter would not prevent him from getting in is both insulting and stupid?

The Prime Minister: The hon. and learned Gentleman had better get it right. I said that there was a recognition in the Common Market countries that the New Zealand problem had to be solved and that they were willing to solve it. That was the point about my reference to New Zealand. As far as Germany is concerned, I refer the hon. and learned Member to an Answer I gave to the hon.

Member for Banbury (Mr. Marten) last week.

Mr. Howie: Is it possible that the hon. and learned Member for Antrim, South (Sir Knox Cunningham) really meant France, for it is hard to see how anyone would wish to join an organisation in such confusion at the moment?

The Prime Minister: I have said repeatedly during the last fortnight that it would not be right for me to comment on the internal difficulties and, indeed, the agonies of France. What is going on there now is no reason for acting on the suggestion put by the hon. and learned Member for Antrim, South (Sir Knox Cunningham).

Sir D. Walker-Smith: If the Prime Minister will not withdraw the application—which many people would think an appropriate thing to do—will he not at least step up the Government's tenuous consideration of the possibilities of alternative courses in this unpredictable situation?

The Prime Minister: I answered a similar question earlier this week and another last week, and I have nothing to add to what I said on those occasions.

Mr. Moyle: Now that the French road block seems to be crumbling, does my right hon. Friend intend to resume the pursuit of our application to join with pace and momentum? If so, does he think that the nation will be behind him?

The Prime Minister: It is not for me to talk about French road blocks. Our application is in with the Six as a whole. If there is a change of attitude in the Six —and we know where our difficulties arose before—we can pursue it with pace and momentum, and we shall continue to do so.

Mr. McMaster: What does the Prime Minister think would be the effect on the prices and incomes policy, particularly wage claims, of a further rise of 13 per cent. in the cost of food on top of the increases which have followed devaluation?

The Prime Minister: That does not arise from the Question on the Order Paper. Nor is it appropriate for me to comment on wages and prices policy in France.

Mr. Macdonald: Is my right hon. Friend not secretly rather glad that his application to join the Common Market was a failure? Will he make applications in future to join bodies which, first, want us to join them and, secondly, which it will be to our economic advantage to join?

The Prime Minister: The question of the economic advantages of joining the Common Market was fully debated by the House a year ago, before we took the decision to apply by a large majority of this House. The majority of the countries in the Common Market are extremely anxious that, not only in our interests but in their interests and those of Europe, we should join the Common Market. So far, only one Power has reserved its position on this point.

Mr. Thorpe: Have not the events of the past two months, particularly in Germany and France, proved what a valuable contribution this country, with its history of political maturity and technical knowledge, should make to the Continent of Europe? On the purely domestic front, does the Prime Minister agree that one by-product of joining the Common Market would be that the ridiculous bitterness between the Northern and Southern parts of Ireland would once and for all be healed?

The Prime Minister: I have felt, as many hon. Members in many parts of the House have felt, that one of the strongest arguments is the political argument. This country cannot remain immune from dangerous tendencies on the other side of the Channel just by pretending that the Channel is wider than it is. I believe that we should have something to contribute towards the stability of Europe, which means in the end the stability of this country.

Sir Knox Cunningham: On a point of order. In view of the unsatisfactory nature of the reply, I will raise the matter again.

LEGISLATION AND ADMINISTRATIVE ACTION

Mr. Ridley: asked the Prime Minister if he will give an undertaking that no administrative action will be taken

by Government Departments in advance of the legislative action authorising it.

The Prime Minister: No, Sir. Successive Governments have found it conducive of the public good from time to time to allow preparatory work to go ahead in advance of the passage of legislation and I see no reason to change the practice.

Mr. Ridley: Is the Prime Minister aware that there is deep objection to the growing practice of Government by circular and Ministerial decree? Will he comment on the growing evidence that a written constitution is what the British people would like to safeguard their rights?

The Prime Minister: Without encroaching on the affairs of other countries, I should say that the existence of a written constitution is not necessarily a guarantee of liberties or stability, nor does it give the flexibility which has always existed in this country. I do not accept the hon. Gentleman's statement about a growing practice. I have said that there have always been occasions— though I agree that this must be done very sparingly—when administrative action has been taken ahead of legislation under successive Governments. The House would be very impatient sometimes if legislation had been passed and there had been no preparation to put it into effect quickly.

COALMINING AREAS (PRIME MINISTER'S VISITS)

Mr. Ridley: asked the Prime Minister which areas where pit closures are proposed he next intends to visit.

The Prime Minister: I pay frequent visits to coal mining areas, Sir, and if the hon. Member would care to let me know the particular one that interests him I would be happy to give him advance warning of my next visit.

Mr. Ridley: Will the Prime Minister undertake the next time he visits such an area not to interfere in the delicate and difficult task of the National Coal Board in closing uneconomic pits, as he did when he visited the North in October and Wales last February?

The Prime Minister: The hon. Gentleman has got it wrong on both counts. Last September I had discussions with the Chairman of the Coal Board before announcing the policy decision that was taken. That policy, involving consultation with regional council chairmen, was the proposal of the Chairman of the Coal Board. As regards Wales, the action was taken by my right hon. Friend the Minister of Power, because in the case of Cefn Coed—I think that was the pit the hon. Gentleman was talking about—the procedures agreed with the Coal Board had not been carried out, in that the Welsh Planning Council had not had a chance to examine all the implications of the proposed closure. Therefore, my right hon. Friend insisted that the proper procedures should be gone through.

Mr. Mendelson: Is my right hon. Friend aware that, whatever frivolous questions he may be asked by hon. Members opposite, this is a most serious matter to those who earn their livelihoods through the coal mining industry? Does he recall that my right hon. Friend the Member for Newton (Mr. Frederick Lee), when Minister of Fuel and Power, gave an undertaking that there would be a general staff of the Minister of Housing and Local Government, the Minister of Fuel and Power and the Secretary of State for Economic Affairs who would meet regularly to plan the bringing of new industries to areas where pit closures are contemplated? Will he implement that policy?

The Prime Minister: It is being implemented, and the arrangements for regional consultation and staff work have been greatly expanded. I should not go into the whole question of fuel policy, but my hon. Friend will be aware of the announcement of my right hon. Friend the President of the Board of Trade about the very special additional help on top of ordinary development area facilities for those areas particularly vulnerable to pit closures where there is no alternative work nearby in the mining industry and there is insufficient alternative employment.

Mr. Peyton: As each would appear to be master of the other's job, why do not the Prime Minister and Lord Robens change places?

Mr. Ogden: Does my right hon. Friend recall the many happy visits he and I have made to Cronton Colliery, Huyton, to the Lancashire Miners' Gala and many other pit areas in the country? Is he aware that there is still and always will be a warm and sincere welcome for him amongst those in the mining industry—

The Prime Minister: rose—[Interruption.]

Mr. Speaker: Order. The compliment is not ended.

Mr. Ogden: —because we appreciate the massive help that the present Government have given to the coal mining areas?

The Prime Minister: I thank my hon. Friend. I had an extremely warm and friendly welcome to the actual pit closure areas and from the lodge concerned both in the case of Cefn Coed and Ynyscedwyn when I visited Wales recently. I hope to get a friendly welcome when I go to Northumberland next month and to Durham the following month.

Mr. Swain: Is my right hon. Friend aware that even in the midst of this so-called unpopularity of the Labour Government he is more welcome in the mining areas even now than any Tory Prime Minister ever was, including the one who turned out the troops against the miners in 1911?

The Prime Minister: No Government which has pursued a policy of industrial change, as we have, and, as we consider it to be necessary, involving so many people leaving their jobs and having to transfer their work, after perhaps a lifetime, could expect to be other than unpopular in those areas. I still accept what my hon. Friend said about the feelings of miners and others in the areas concerned, when it is a question of their considering any possible alternative.

HOUSE OF LORDS (REFORM)

Mr. William Hamilton: asked the Prime Minister how many meetings have been held between party leaders to


discuss House of Lords reform; and how many more are expected before agreed proposals are published.

The Prime Minister: I would refer my hon. Friend to the Answer I gave to a supplementary question by him on 2nd April.—[Vol. 762, c. 173–4.]

Mr. Hamilton: Is my right hon. Friend aware that that did not answer the Question on the Order Paper? Will he now impose the Guillotine upon the talks? Is my right hon. Friend aware that a nominated, salaried Upper Chamber would be violently opposed by his hon. Friends, and that it is much more important at this stage to get the support of Members on this side of the House than hon. Members opposite? It would serve our purposes very well if there were deliberately provoked a head-on clash with the other House, as seems likely.

The Prime Minister: On one thing my hon. Friend and I are in complete agreement—that my answer did not answer the Question on the Order Paper. The reason is that it was agreed at the outset by those taking part in the talks not only that no statements would be made while they were continuing but that there should not be even a reference to the number, dates or times of the individual meetings. I am carrying out that undertaking. Certainly, when the House debates whatever report emerges, views such as those expressed by my hon. Friend will be expressed again, and we shall pay full attention to them. I am sorry on such a pleasant sunny afternoon on the eve of our holiday to hear such bloodthirsty warnings from my hon. Friend.

Mr. John Wells: Do the party leaders with whom the Prime Minister has been discussing things include the leaders of the parties represented by the hon. Members for Pembroke (Mr. Donnelly), Shipley (Mr. Hirst), Carmarthen (Mr. Gwynfor Evans) and Hamilton (Mrs. Ewing)?

The Prime Minister: The hon. Gentleman's premise was wrong, because I have not myself been engaged in the talks. I had a discussion with the right hon. Gentlemen the Leader of the Opposition and the Leader of the Liberal Party to

agree the basis on which our colleagues could enter into the talks. Although I have not been involved in them, I assure the hon. Gentleman that the talks are confined to representatives in both Houses of the three parties in this House.

Mr. Orme: Is my right hon. Friend aware that the talks that go on between the usual channels, which exclude backbench Members, are increasingly met by criticism and resistance by back-bench Members, who resent being the last people to be consulted about changes, about legislation, and about many other matters affecting the House? Does he agree that it is about time this system was ended?

The Prime Minister: My hon. Friend is wrong. It is anything but the usual channels in this case. I think that it would be generally agreed that, if there is to be a major constitutional change of this kind, it should be discussed between all the parties concerned, and, if possible, agreement reached. The agreement would then be reported to this House, and, before any decision was taken, the views of all hon. Members in this House would be sought in a debate on the proposals. That, of course, would precede any legislation. The House will be in absolute control and mastery of the report. However, I do not think it would be possible to have consultation with 600 Members of this House and many hundreds of Members of another place to get an agreed report.

Sir D. Renton: Is it not a bit soon to start guillotining Members of another place?

Mr. Shinwell: In contrast to the suggestion made by my hon. Friend the Member for Fife, West (Mr. William Hamilton), would the Prime Minister at some time care to have a referendum on this subject, excepting myself, to discover with what anxieties some hon. Members on this and on the other side are consumed to be transferred to the other place?

The Prime Minister: My right hon. Friend is, of course, quite right. This is a seasonal syndrome which is bound to be highly developed about this time of the year.

Sir H. Legge-Bourke: Would the Prime Minister agree that the major


constitutional reform expressed by the Minister of Technology last weekend has considerable relevance to any change in the constitutional position between the two Houses?

The Prime Minister: I have already answered a Question about my right hon. Friend's speech. I think that any decision about constitutional changes of this kind must be taken in the two Houses of Parliament, not by referendum or anything else. We shall have the report, and this House and another place must be free to make up their minds on it.

Mr. Arthur Lewis: Is my right hon. Friend aware that, to put it mildly, there may be some dismay upon the part of the many sick and disabled who find they will have prescription charges imposed upon them whilst their noble Lords are given £2,000 a year, plus expenses, in a non-elected body? Is he aware that that would not be very satisfactory?

The Prime Minister: My hon. Friend must not make any assumption about what will come out of the report on the point that he has mentioned. The House will be discussing prescription charges later today.

RHODESIA (UNITED NATIONS RESOLUTION)

Sir Alec Douglas-Home: (by Private Notice) asked the Commonwealth Secretary whether he will make a statement on the United Nations Resolution on Rhodesia.

The Secretary of State for Commonwealth Affairs (Mr. George Thomson): As the House knows, a meeting of the Security Council on Rhodesia was called to deal with the situation created by the illegal hangings. A draft Resolution was tabled on 18th April by the African and Asian members of the Security Council. It envisaged the use of force and measures against South Africa and Portugal. On 23rd April we presented our own draft Resolution to the Council. It was explained to the House by my right hon. Friend the Foreign Secretary, on the following day and the text included in the OFFICIAL REPORT.
Since then discussions have been continuing in New York and these dis-

cussions have now led to a unanimous Resolution. We did not sponsor it—nor did the Afro-Asians—but the whole Security Council, without exception, has given it its vote. I think that it is a considerable achievement that it has been possible for the Council to adopt unanimously a complex and detailed Resolution touching on many of the national interests of United Nations members. This is impressive testimony to the refusal of the international community to accept the illegal régime and its objectives for Southern Rhodesia.
I will circulate in the OFFICIAL REPORT the text of the Resolution that has now been passed. We have throughout made it clear that we cannot contemplate the use of force to solve the Rhodesian problem and that we are not prepared to engage in an economic confrontation with South Africa. There is nothing in the Resolution that conflicts with our position on these essential points. Most of the detailed provisions of the Resolution are based on the earlier United Kingdom draft.
As my right hon. Friend the Foreign Secretary explained to the House on 24th April, the main effect of these provisions will be to make sanctions more comprehensive, to block methods of evading sanctions, and to require other countries to place the same prohibitions on trade with Southern Rhodesia as we have applied to our own trade.
One new paragraph requests States— and here I quote for the information of the House—
to take all possible further action under Article 41 of the Charter to deal with the situation in Southern Rhodesia",
while another—and again I quote—
emphasises the need for the withdrawal of all consular and trade representation in Southern Rhodesia".
In his explanation of vote on these paragraphs our Permanent Representative at the United Nations, my right hon. and noble friend Lord Caradon, made our position clear in the following terms— and here I use his words:
We have to bear in mind the special responsibility of the United Kingdom as administering authority. That responsibility has been recog-ised and emphasised in the Resolution itself. It has been accepted in our consultations that we will retain our Mission and communications with Rhodesia".


The Resolution contains some additional paragraphs of a political character. These paragraphs are consistent with the policy of Her Majesty's Government which is based on the six principles to which both sides of the House are committed. Nothing in these paragraphs places any restriction on Britain, beyond what is contained in the six principles themselves, to discharge her responsibilities towards Rhodesia as she thinks best. Nothing in these paragraphs condones the use of violence.
Her Majesty's Government maintain their opposition to violence as a means of solving the Rhodesian problem. Our whole policy, indeed, has been to give the people of Southern Rhodesia all the moral and material assistance we can to enable them to shape their future in a peaceful way.
The House will, of course, have a full opportunity to debate the legislation which will be necessary to give effect to a number of provisions of the Resolution.

Sir Alec Douglas-Home: Will the right hon. Gentleman, on behalf of the Government, interpret the words
moral and material assistance to the people of Southern Rhodesia in their struggle to achieve their freedom …
Does this, cover, for example, the import of arms into that country? If not, did Lord Caradon make it clear in an explanation of vote, which has been done on previous occasions, and, I would think, should have been done now? Is it not very dangerous, even reprehensible, to vote for words which are ambiguous, as these are? Could they not indeed encourage others to act in a way which Her Majesty's Government might deplore? Ought not the right hon. Gentleman to look at these words again?

Mr. Thomson: I thought that I had been careful to say in my opening statement that we defined "moral and material assistance" as being the kind of assistance that would enable the people of Southern Rhodesia—all the people of all races—to shape their future in a peaceful way.
The right hon. Gentleman is referring to operative paragraph 13 of the Resolution. This is couched in non-mandatory language. I assure the House that we would never have voted for this paragraph if we had believed that its terms in any way im-

plied we either support or condone the use of violence. This Government have given a good deal of both moral and material assistance to the people of Rhodesia. We intend to go on doing so until constitutional and legal rule is reestablished.

Sir Alec Douglas-Home: This is important. There is nothing here to say that this material assistance should be of a peaceful nature. We understand that the right hon. Gentleman and the Government feel that no other sort of material should go, but it may well suit other people to send this kind of material and to quote in favour of their action a mandatory Resolution which is ambiguous. This is the danger.

Mr. Thomson: The prime responsibility for the growing violence concerning Rhodesia rests with those who illegally seize power—[HON. MEMBERS: "Hear, hear."] I think that a proper sense of fairness in the House would accept that that was the position. Concerning this Resolution, I stand by the words I used, which have been most carefully chosen. This is the position of Her Majesty's Government on these words.

Mr. Heath: Will the right hon. Gentleman quote the words in the Security Council's Resolution which govern this matter? Does it include the words "in a peaceful context" or "a peaceful settlement"? As I understand, it does not.

Mr. Thomson: I am putting the full text, which is long, in the Library. I appreciate that it is difficult for the House when faced with a long text such as this. Paragraph 13, which I remind the House is non-mandatory,
urges all States members of the United Nations to render moral and material assistance to the people of Southern Rhodesia in their struggle to achieve their freedom and independence".
Our interpretation of those words is the one which I have just given.

Mr. Heath: Is it not clear that those words are an incitement to other people to infiltrate forces and arms into Rhodesia for which Her Majesty's Government claim direct responsibility? By voting for this Resolution, Her Majesty's Government are directly responsible for any physical conflict in Rhodesia.

Mr. Thomson: That is not so. The original Resolution tabled by African and Asian members of the Security Council called for the use of force. This Resolution, partly as a result of the efforts of Lord Caradon at the United Nations, has dropped all mention of that. The terms of that paragraph urge the international community to give moral and material assistance to the people of Rhodesia to achieve a peaceful solution to their problems.
The source of the provocation to use violence in Rhodesia comes from those who have usurped power illegally inside Rhodesia. I wish that we had the same sort of support that we enjoyed at the United Nations from hon. Gentlemen opposite for a solution to this problem.

Mr. Hooley: Does my right hon. Friend agree that this Resolution is of the greatest political significance, permitting as it does the major Powers in Western Europe and Eastern countries to return Rhodesia to legal rule by the authority of the United Nations? Does my right hon. Friend further agree that that authority will be gravely compromised unless we press on and enforce this Resolution with the most vigorous action possible?

Mr. Thomson: Yes, Sir. I agree with my hon. Friend, and I hope that the House will give us the necessary power to enforce the Resolution.

Mr. Edward M. Taylor: Despite what the right hon. Gentleman said, cannot this Resolution be interpreted by other States as a virtual declaration of war on Rhodesia? What steps can the United Nations take to make sure that States do not give material aid to terrorists from Zambia or elsewhere who are going into Rhodesia without any support from the Rhodesian people?

Mr. Thomson: I think that the hon. Gentleman must have overlooked what I said at the beginning, that this long debate in the international community of the United Nations began with a proposition for the use of force. That proposition has been dropped as a result of painstaking diplomacy. This Resolution is an attempt to find a peaceful solution to the Rhodesian problem.

Mr. Philip Noel-Baker: I warmly congratulate the Government on having

secured a Resolution which will greatly strengthen the hope of a peaceful settlement of the Rhodesian question on a basis which will allow the six principles to be applied, to which, at one point of time, Her Majesty's Opposition used to be committed.

Mr. Thomson: I am obliged to my right hon. Friend for what he has said.

Sir D. Walker-Smith: As the words are clearly ambiguous, and as the juxtaposition of the word "struggle" might be interpreted contrary to what the right hon. Gentleman suggests, will he undertake here and now that Her Majesty's Government will use their veto in the Security Council against any action or further Resolution which leans upon an interpretation of this as justifying aggression or terrorist activities, whether within Rhodesia or without?

Mr. Thomson: I do not think that the right hon. and learned Gentleman is taking a proper view of the discussions at the United Nations. I repeat that they began with a demand for the use of force. They ended with this Resolution, which contains no mention of the use of force. That is the important thing to bear in mind. I remind the right hon. and learned Gentleman that this is a Resolution which, for the first time in the history of the Rhodesian problem before the United Nations, has been carried unanimously by all members of the Security Council. This is an enlarged Security Council of 15 members who represent a cross-section of the international community. I think that the Conservative Party is getting itself seriously out of step with what I would call the civilised opinions of the international community.

Mr. Winnick: Bearing in mind that the Resolution expresses the point of view of the world community, can my right hon. Friend explain why, time and again when Rhodesia comes up for discussion at Question Time, the Opposition seem to take the side of the illegal régime against their own country? Why should the Tory Opposition support traitors in Salisbury who support an illegal racialist régime?

Mr. Thomson: I appreciate my hon. Friend's feelings, but I think that that



is a question for the Leader of the Opposition, and not for me.

Mr. Lubbock: Is it not typical of the Conservative Party that it should prefer to leave out all reference to morality in this Resolution—

Hon. Members: Bomb them.

Mr. Speaker: Order.

Mr. Lubbock: —and, before the ink is dry on the paper, that it should be trying to undermine an agreement arrived at unanimously for the first time at the United Nations? Does the right hon. Gentleman agree that the only alternative to this Resolution is capitulation to the illegal régime? Why did not the right hon. Gentleman introduce such a Resolution very much earlier?

Mr. Thomson: I agree that the alternatives were either capitulation or force. This is a sensible international compromise, and I hope that, on reflection, and after the party opposite, or at least its leadership, has had time to study it, hon. Gentlemen will feel that it is right to give us bipartisan support behind the unanimous Security Council Resolution.

Mr. Richard: Is my right hon. Friend aware that many hon. Members on this side of the House are becoming increasingly worried about the attitude of the Opposition? Is it not becoming increasingly clear that when the world community has for the first time agreed on a concerted course of action it is the duty of the Opposition to examine their conscience carefully before they put on the sort of exhibition that we have seen this afternoon?

Mr. Thomson: Yes, Sir.

Sir C. Taylor: Is the right hon. Gentleman aware that the policy of increased sanctions means a policy of slow starvation for all the people of Rhodesia? What does he intend to do about that?

Mr. Thomson: As I have said, there are three possible courses. There is surrender, there is force, and there is the peaceful application of sanctions. Nobody denies that the peaceful application of sanctions is painful, and causes suffering, but I think that it is the least of the three evils. I am not sure which

one the hon. Gentleman is urging. Is he urging surrender? Will he be frank with the House?

Mr. Eadie: Is my right hon. Friend aware that the way in which he is handling the duties of his office is gaining the admiration of people all over the world? Is he further aware that in January of this year a Member of another place, who formally sat on the benches opposite, made a statement after visiting Rhodesia—

Mr. Speaker: Order. No quotations from the other place unless they are from the speech of a Minister explaining Government policy.

Mr. Eadie: Is my right hon Friend aware that a statement was made by a former Member of this House that after visiting Rhodesia—

Mr. Speaker: Order. The hon. Member must develop his own argument. He must not quote, or even paraphrase, from the other place.

Mr. Eadie: Is my right hon. Friend aware that a statement was made by a former Conservative Minister, who dealt with this problem, that it was like dealing with a shadow in the back?

Mr. Hastings: The right hon. Gentleman has been giving us his interpretation of this ambiguous paragraph 13, but what did Lord Caradon say? Did he make it plain to the United Nations in his speech that material support did not include the infiltration of arms or any other form of encouragement to these terrorists? When will we have the text of his speech?

Mr. Thomson: I shall put in the Library for the convenience of the hon. Member the text of what Lord Caradon said during these debates. What fascinates me about the question is that, of 23 operative paragraphs, the hon. Gentleman has picked on only one and is not prepared to give his support on those executive and mandatory paragraphs which are designed to secure a peaceful solution.

Mr. Judd: Would my hon. Friend agree that, as suggested in the Resolution, the new situation will place Zambia in a critical position? Can he assure us that he will do everything possible to back


her up, even at the eleventh hour reconsidering our attitude to the TanZam Railway?

Mr. Thomson: Zambia's position is recognised in the operative paragraph 15 of the Resolution. We are the country which has given Zambia the most substantial assistance so far in meeting the difficulties created by the Rhodesia rebellion. Our economic capacity to increase that assistance is limited, as the House knows, and I hope that one effect of this paragraph will be to persuade other members of the international community to match our efforts in helping Zambia.

Mr. Hugh Fraser: While welcoming, as of course we do, the ingenious diplomatic activities, may I ask whether the right hon. Gentleman can explain how material help in a struggle can mean anything other than the supply of arms?

Mr. Thomson: By the continuation of the policy of the Government to which the right hon. Gentleman belonged, of giving financial assistance to the University College in Rhodesia, for example, giving material help in the struggle of the Rhodesian people to train themselves to run their own affairs eventually under majority rule.

Sir D. Foot: Is it not a fact that Rhodesia has been ruled by force and by nothing else ever since November, 1965? Why is it that hon. Members opposite never seem to object to the use of force by the oppressors, but only when it is used by the oppressed?

Mr. Thomson: I cannot speak for the party opposite on this issue and I would not wish to try to do so.

Rear-Admiral Morgan Giles: In view of the possible ambiguity of the new Resolution, and since the Government do not wish to encourage the use of force, will the Commonwealth Secretary make it clear to those African States bordering Rhodesia, and which are believed to be harbouring armed bands for incursions into Rhodesia, that the Resolution is not intended to connive at any such activity?

Mr. Thomson: This is what I have been seeking to do since I came to the Box this afternoon. I say again, with all the authority which I command on

behalf of the Government, that this paragraph and the Resolution does not imply either the support or the condoning of force.

Mr. Henig: Since there have been many complaints from hon. Gentlemen opposite in the past that sanctions have not been working because of the loopholes, can my right hon. Friend explain why, now that the international community is collectively agreed on closing those loopholes, hon. Gentlemen opposite are still complaining?

Several Hon. Members rose—

Mr. Speaker: Order. I must move on. Mr. Heath, business question.

Following is the text of the Resolution:

The Security Council

Recalling and reaffirming its Resolutions 216 (1965) of 12th November, 1965, 217 (1965) of 20th November, 1965, 221 (1966) of 9th April, 1966, and 232 (1966) of 16th December, 1966.

Taking note of Resolution 2262 (xxii) adopted by the General Assembly on 3rd November, 1967.

Noting with great concern that the measures taken so far have failed to bring the rebellion in Southern Rhodesia to an end.

Reaffirming that, to the extent not superseded in this Resolution, the measures provided for in Resolutions 217 (1965) of 20th November, 1965, and 232 (1966) of 16th December, 1966, as well as those initiated by member States in implementation of those Resolutions, shall continue in effect.

Gravely concerned that the measures taken by the Security Council have not been complied with by all States and that some States, contrary to Resolution 232 (1966) of the Security Council and to their obligations under article 25 of the Charter, have failed to prevent trade with the illegal régime in Southern Rhodesia.

Condemning the recent inhuman executions carried out by the illegal régime in Southern Rhodesia which have flagrantly affronted the conscience of mankind and have been universally condemned,

Affirming the primary responsibility of the Government of the United Kingdom to enable the people of Southern Rhodesia to achieve self-determination and independence, and, in particular, their responsibility for dealing with the prevailing situation,

Recognising the legitimacy of the struggle of the people of Southern Rhodesia to secure the enjoyment of their rights as set forth in the Charter of the United Nations and in conformity with the objectives of General Assembly Resolution 1514 (xv),

Reaffirming its determination that the present situation in Southern Rhodesia constitutes a threat to international peace and security,

Acting under Chapter vii of the United Nations Charter,

1. Condemns all measures of political repression, including arrests, detentions, trials and executions which violate fundamental freedoms and rights of the people of Southern Rhodesia, and calls upon the Government of the United Kingdom to take all possible measures to put an end to such actions.

2. Calls upon the United Kingdom as the administering power in the discharge of its responsibility to take urgently all effective measures to bring to an end the rebellion in Southern Rhodesia, and enable the people to secure the enjoyment of their rights as set forth in the Charter of the United Nations and in conformity with the objectives of General Assembly Resolution 1514 (xv).

3. Decides that, in furtherance of the objective of ending the rebellion, all States Members of the United Nations shall prevent:

(a) the import into their territories of all commodities and products originating in Southern Rhodesia and exported therefrom after the date of this Resolution (whether or not the commodities or products are for consumption or processing in their territories, whether or not they are imported in bond and whether or not any special legal status wi:h respect to the import of goods is enjoyed by the port or other place where they are imported or stored); 
 (b) any activities by their nationals or in their territories which would promote or are calculated to promote the export of any commodities or products from Southern Rhodesia; and any dealings by their nationals or in their territories in any commodities or products originating in Southern Rhodesia and exported therefrom after the date of this Resolution, including, in particular, any transfer of funds to Southern Rhodesia for the purposes of such activities or dealings; 
 (c) The shipment in vessels or aircraft of their registration or under charter to their nationals, or the carriage (whether or not in bond) by land transport facilities across their territories of any commodities or products originating in Southern Rhodesia and expected therefrom after the date of this Resolution; 
 (d) The sale or supply by their nationals or from their territories of any commodities or products (whether or not originating in their territories, but not including supplies intended strictly for medical purposes, educational equipment and material for use in schools and other educational institutions, publications, news material, and, in special humanitarian circumstances, foodstuffs), to any person or body in Southern Rhodesia or to any other person or body for the purposes of any business carried on in or operated from Southern Rhodesia, and any activities by their nationals or in their territories which promote or are calculated to promote such sale or supply; 
 (e) The shipment in vessels or aircraft of their registration, or under charter to their nationals, or the carriage (whether or not in bond) by land transport facilities across

their territories of any such commodities or products which are consigned to any person or body in Southern Rhodesia, or to any other person or body for the purposes of any business carried on in or operated from Southern Rhodesia.

4. Decides that all States members of the United Nations shall not make available to the illegal régime in Southern Rhodesia or to any commercial industrial or public utility undertaking, including tourist enterprises, in Southern Rhodesia any funds for investment or any other financial or economic resources and shall prevent their nationals and any persons within their territories from making available to the régime or to any such undertaking any such funds or resources and from remitting any other funds to persons or bodies within Southern Rhodesia except payments exclusively for pensions or for strictly medical, humanitarian or educational purposes or for the provision of news material and in special humanitarian circumstances, foodstuffs.

5. Decides that all States members of the United Nations shall:

(a) prevent the entry into their territories, save on exceptional humanitarian grounds, of any person travelling on a Southern Rhodesian passport, regardless of its date of issue, or on a purported passport issued by or on behalf of the illegal régime in Southern Rhodesia, and
 (b) Take all possible measures to prevent the entry into their territories of persons whom they have reason to believe to be ordinarily resident in Southern Rhodesia and whom they have reason to believe to have furthered or encouraged, or to be likely to further or encourage, the unlawful actions of the illegal régime in Southern Rhodesia or any activities which are calculated to evade any measure decided upon in this Resolution or Resolution 232 (1966) of 16th December, 1966.

6. Decides that all States members of the United Nations shall prevent airline companies constituted in their territories and aircraft of their registration or under charter to their nationals from operating to or from Southern Rhodesia and from linking up with any airline company constituted or aircraft registered in Southern Rhodesia.

7. Decides that all States members of the United Nations shall give effect to the decisions set out in operative paragraphs 3, 4, 5 and 6 of this Resolution notwithstanding any contract entered into or licence granted before the date of this Resolution.

8. Calls upon all States members of the United Nations or of the Specialised Agencies to take all possible measures to prevent activities by their nationals and persons in their territories promoting, assisting or encouraging emigration to Southern Rhodesia, with a view to stopping such emigration.

9 Requests all States members of the United Nations or of the Specialised Agencies to take all possible further action under Article 41 of the Charter to deal with the situation in Southern Rhodesia, not excluding any of the measures provided in that Article.

10. Emphasises the need for the withdrawal of all consular and trade representation in Southern Rhodesia, in addition to the provisions of operative paragraph six of Resolution 217 (1965).

11. Calls upon all States members of the United Nations to carry out these decisions of the Security Council in accordance with Article 25 of the United Nations Charter and reminds them that failure or refusal by any one of them to do so would constitute a violation of that Article.

12. Deplores the attitude of States that have not complied with their obligations under Article 25 of the Charter, and censures in particular those States which have persisted in trading with the illegal régime in defiance of the Resolutions of the Security Council, and which have given active assistance to the régime.

13. Urges all States members of the United Nations to render moral and material assistance to the people of Southern Rhodesia in their struggle to achieve their freedom and independence.

14. Urges, having regard to the principles stated in Article 2 of the United Nations Charter, States not member nations of the United Nations to act in accordance with the provisions of the present Resolution.

15. Requests States members of the United Nations, the United Nations organisations, the Specialised Agencies, and other international organisations in the United Nations system to extend assistance to Zambia as a matter of priority with a view to helping her solve such special economic problems as she may be confronted with arising from the carrying out of these decisions of the Security Council.

16. Calls upon all States members of the U.N. and, in particular, those with primary responsibility under the Charter for the maintenance of international peace and security, to assist effectively in the implementation of the measures called for by the present resolution.

17. Considers that the United Kingdom as the administering Power should ensure that no settlement is reached without taking into account the views of the people of Southern Rhodesia, and, in particular, the political parties favouring majority rule, and that it is acceptable to the people of Southern Rhodesia as a whole.

18. Calls upon all States members of the United Nations or of the Specialised Agencies to report to the Secretary General by 1st August, 1968, on measures taken to implement the present Resolution.

19. Requests the Secretary General to report to the Security Council on the progress of the implementation of this Resolution, the first report to be made not later than 1st September, 1968.

20. Decides to establish, in accordance with Rule 28 of the provisional rules of procedure of the Security Council, a committee of the Security Council to undertake the following tasks and to report to it with its observations:

 (a) To examine such reports on the implementation of the present Resolutions as are submitted by the Secretary General. 

 (b) To seek from any States members of the United Nations or of the Specialised Agencies such further information regarding the trade of that State (including information regarding the commodities and products exempted from the prohibition contained in operative paragraph 3(d) above) or regarding any activities by any nationals of that state or in its territories that may constitute any evasion of the measures decided upon in this Resolution as it may consider necessary for the proper discharge of its duty to report to the Security Council.

21. Requests the United Kingdom, as the administering Power, to give maximum assistance to the Committee, and to provide the Committee with any information which it may receive in order that the measures envisaged in this Resolution and Resolution 232 (1966) may be rendered fully effective.

22. Calls upon all States members of the United Nations, or of the Specialised Agencies, as well as the Specialised Agencies themselves, to supply such further information as may be sought by the Committee in pursuance of this Resolution.

23. Decides to maintain this item on its agenda for further action as appropriate in the light of developments.

BUSINESS OF THE HOUSE

Mr. Heath: May I ask the Leader of the House whether he will state the business of the House for the first week after the Whitsun Recess?

The Lord Privy Seal and Leader of the House of Commons (Mr. Fred Peart): Yes, Sir. The business for the first week after the Recess will be as follows:
TUESDAY, 11TH JUNE—Progress on the remaining stages of the Gaming Bill.
WEDNESDAY, 12TH JUNE—Remaining stages of the Gaming Bill, which it is hoped to complete by about 7 o'clock.
Motion on Harbours (Exchequer Loans and Grants).
THURSDAY, 13TH JUNE—Remaining stages of the Gas and Electricity Bill. Lords Amendments to the Agriculture (Miscellaneous Provisions) Bill.
FRIDAY, 14TH JUNE—Remaining stages of the Education Bill [Lords] and of the Customs Duties (Dumping and Subsidies) Amendment Bill.
Motions on the Double Taxation Relief Orders relating to Antigua, Cyprus, Dominica, Sierra Leone, Zambia, Portugal, Gambia, Malawi, St. Lucia and St. Vincent.
Motion relating to Redundant Mine-workers (Payments Scheme) Order.

Mr. Heath: As we understand that the Government are refusing to allow us to take the prices and incomes Prayer on Tuesday, 11th June, will the right hon. Gentleman give us an assurance that he will provide time for us to debate this on a Motion and that sufficient time will be allotted for it to be debated properly?
Second, what steps is the right hon. Gentleman taking to prevent the House from ever again having to endure the chaos which we have faced this week?

Mr. Peart: On the first matter, I certainly give that assurance. On the second question, I hope that the right hon. Gentleman, after all I have said, will not exaggerate. He should approach these matters in a more relaxed fashion.

Mr. Swain: I thank my right hon. Friend for providing time to discuss the Regulations under the Coal Industry Act. Is he aware that the last three debates affecting the lives of men in the mining industry have taken place at very inconvenient hours? This debate will apparently take place on an inconvenient day. Would he guarantee that the preceding proceedings will be dealt with expeditiously so as to allow maximum time to debate this very important subject?

Mr. Peart: I will do all I can to achieve this. I thought that my hon. Friend welcomed this arrangement.

Sir Frank Pearson: Will the writ for the Nelson and Colne by-election be moved before we return after Whitsun?

Mr. Peart: That is a matter for my right hon. Friend the Patronage Secretary. I do not usually answer this at Business question time.

Mr. Hector Hughes: Would my right hon. Friend find time at an early date for a debate upon my Motion No. 325:

[That this House views with disfavour the proposal to disband certain distinguished Scottish regiments, in particular the Gordons and Argylls, both of which have close family and other connections with Aberdeen and other places in north-east Scotland from which those regiments draw their members and upon which places their gallantry and military distinctions shed glory; and calls upon

the Government to allow these regiments to continue their patriotic work.]

which is urgent, is designed to stop an impending action by Her Majesty's Government, is of great interest to many people in Scotland and is appropriately entitled, "The Glorious Gordons and Argylls"?

Mr. Peart: I have noted my hon. and learned Friend's remarks and his Motion. I agree that we should pay tribute to two very fine regiments, but I cannot find time when we return.

Mr. Blaker: Although it may be true that the present Leader of the House does not usually answer questions about by-elections, would he not take into account the fact that parliamentary representation in Nelson and Colne is urgently needed and that the people there are feeling neglected? Would he get on with it?

Mr. Peart: The Government will. The hon. Gentleman should not worry.

Mr. C. Pannell: My right hon. Friend will know that the Select Committee on Parliamentary Privilege laid its Report before the House last December and that, since then, I have several times raised this with his predecessor and now with him? In view of the fact that, whenever privilege comes up, it renders the House open to attack because of practices which are now out-dated and too old, will he actively consider this Report to see whether it is possible to sort out from it those parts which do not need legislation, so that the House may have an early debate with a view to abolishing privilege as we once knew it?

Mr. Peart: I agree that this is a very important matter. Indeed, events have shown that privilege is still in our minds. I give the assurance that I will actively consider the Report and also my right hon. Friend's remarks.

Mr. Eldon Griffiths: In view of the public concern about the rôle of Parliament in their lives and the great changes made in the lives of ordinary citizens by the Transport Bill, the Prices and Incomes Bill and the Finance Bill, would the right hon. Gentleman consider publishing a White Paper explaining to the people why that many of their elected representatives were unable to speak and, in some cases, unable to vote on matters of this importance to the country?

Mr. Peart: I am sorry, but I have replied to the hon. Member before, and he has accused me of being totalitarian and a drawing-room storm trooper. I think that the hon. Gentleman should follow the advice I have just given his Leader, and relax.

Mr. Victor Yates: May I ask my right hon. Friend whether he will now provide time for a discussion of Motion 298 standing in my name and that of 151 hon. Members on both sides of the House, representing all parties? Last week, the Minister, in replying to me, said that the question of the selection of speakers was a matter for the Chair. May I, with respect, and open to correction if necessary by you, Mr. Speaker, refer him to the Report of the Select Committee on Privilege of 19th September, 1959, in which it is clearly stated that the Chair is bound to give automatic priority to Privy Counsellors in both debate and Parliamentary Questions?

[That this House is of opinion that the practice of giving precedence to Privy Counsellors and former Ministers in debate should be ended and that back benchers should have equal opportunity.]

Mr. Speaker: The hon. Gentleman is drifting away on to the merits of the matter. He can ask for a debate.

Mr. Yates: I am asking whether the Leader of the House will now realise the importance of debating the democratic right of hon. Members to debate unimpeded by this out-moded procedure.

Mr. Peart: My hon. Friend has communicated his view to me and I know he feels strongly on this subject. It may be that we should have a debate on matters of the kind that he has mentioned, but I could not find time for such a Motion in the week after next, but I will look into the matter.

Mr. Hugh Fraser: May I ask whether the right hon. Gentleman is aware of the great feeling about Biafra generally in the House and could he impart to his colleagues the idea that it is now really necessary for some Red Cross action to be taken on refugees, and could he try to see that a statement is made to the House, when we return, on what action the Government have succeeded in taking?

Mr. Peart: I will convey the views of the right hon. Gentleman to my right hon. Friend the Commonwealth Secretary. He did make a statement on this, but I will communicate to him immediately the specific point made by the right hon. Gentleman about the Red Cross.

Mr. E. Rowlands: Is my right hon. Friend aware that we are very disappointed that, again, he has not provided time for a debate on the Report of the Estimates Committee on Prisons? There have been statements by Ministers on policy as well as important statements by the Prison Officers' Association; and the only people who have been unable to debate it are hon. Members. Will my right hon. Friend not give a full day's time to debate this very important Report?

Mr. Peart: My hon. Friend knows the history of this matter. I cannot find time for a debate on this subject in the week after next.

Mr. Godber: In view of the serious economic problems confronting the fishing industry, and the wholly inadequate reply of the Government in a recent debate, can the right hon. Gentleman promise an early statement by the Government when we return?

Mr. Peart: I cannot say specifically when there will be a statement, or what will be done, but, obviously, my right hon. Friend who is responsible for this industry has given this urgent consideration.

Mr. Shinwell: Would my right hon. Friend reconsider his decision on the point raised by my hon. Friend the Member for Birmingham, Ladywood (Mr. Yates) on the subject of Privy Councillors? Is he aware that I have submitted an Amendment to the Motion which provides that all hon. Members should become Privy Councillors? Would not that be a simple solution?

Mr. Speaker: The right hon. Gentleman is drifting into the merits. He must ask for time for discussion of his Amendment.

Mr. Peart: I do not think that my right hon. Friend's Amendment would be a simple one. I cannot find time for it in the week after next.

Mr. Peyton: Are we to take it, from the repeated advice given to us by the Leader of the House to relax a bit, that his handling of the business of the House is to be such, in contrast to that of his predecessor and to last week, that this will be possible?

Mr. Peart: I would only say to the hon. Gentleman that I myself am a rather relaxed personality. I do not believe in panicking, or in getting involved in hysteria or the exaggerated views of the kind with which I am sometimes confronted. I hope that the hon. Member has a very good holiday.

Mr. English: In view of the remarks of my right hon. Friend the Member for Leeds, West (Mr. C. Pannell), will my right hon. Friend remember that he may wish to allow us to discuss the Report on Privilege, but that it would be extremely difficult, in view of the many members of that Committee, to separate what can be done by Resolution of the House from what can only be done by legislation? Will he take care on this issue?

Mr. Peart: This is a very complicated matter. I can only say I cannot find time for such a debate the week after next.

Dame Joan Vickers: May I ask the right hon. Gentleman whether he has seen the Motion on Private Members' Bills, whether he realises that during the last three days we have worked harder, for longer hours and with less freedom than many inmates of Broadmoor or Dartmoor, and that the only freedom left to hon. Members is the expression of our views on Private Members' Bills on a Friday? Would he look into the fact that the Government Whips are now officially objecting to Private Members' Bills?

[That this House deplores the action of the Government Whips concerning their treatment of Private Members' Bills, and the manner in which they can object to bills which they do not favour, instead of allowing Members to decide on the merits of the individual bills.]

Mr. Peart: The task of the Government has been to help private Members in the best sense. I recognise that hon. Members on both sides have worked very hard during the last three weeks.

Mrs. Renée Short: Further to my right hon. Friend's reply to my hon. Friend the Member for Cardiff, North (Mr. Rowlands) about time to debate the Report of the Estimates Committee on Prisons, is my right hon. Friend aware that this Report was presented to the House last August, that that is almost one year ago and that it is high time this House had an opportunity to discuss it? Will he reconsider the answer he gave to my hon. Friend?

Mr. Peart: I am aware of this, but my hon. Friend knows the history. There was an opportunity. I cannot find time during the week in which we come back.

Mr. Geoffrey Lloyd: While understanding the bland use of the word "relaxation" on the lips of the Leader of the House when the Government are about to have a slight respite from the House of Commons, will he perhaps take it from me that those who have been here for a very long time, and have been through many stressful periods in Parliamentary life, feel that there was something peculiarly disgusting in the chaos to which the Government reduced the House last week, and that the casual use of the word "relaxation", will be much resented in relation to my right hon. Friend and those whom he leads, representing the overwhelming body of opinion in the country?

Hon. Members: Oh.

Mr. Speaker: Order. I want to hear the business question.

Mr. Peart: I am sorry that the right hon. Gentleman feels so sensitive. I did not want to be in any way offensive to his right hon. Friend. If I was I apologise; but I thought I was giving sound advice which I hope he takes.

Mr. Dickens: In view of the mounting anxiety felt throughout the country over unemployment caused by company mergers in the private sector, would my right hon. Friend provide time soon after the Recess for a debate on Motion 163 standing in my name, which is supported by many of my hon. Friends, asking for a code of conduct for the private sector of the economy and all private firms in receipt of public funds?

[That this House, while fully supporting the Government's regional policies as an instrument of full employment and economic growth, notes that Government assistance to private industry is currently costing the taxpayer £2 million per day; expresses grave concern about the lack of social responsibility evident in recent company mergers, with their subsequent effect on factory closures and unemployment; calls upon the Government to enter into urgent discussions with the Confederation of British Industries and the Trades Union Congress to prepare a code of conduct applicable to all private firms in receipt of public funds, to include trade union recognition, joint consultation with trade unions, local authorities and regional economic planning councils, particularly on proposed factory closures and manpower redeployment, compensation for redundancy, transferability of pensions, payment of transfer allowances, the phased introduction of equal pay and staff status for manual workers, company manpower and training policies; and, thus, to make the private sector of the economy more fully accountable to the nation.]

Mr. Peart: I have carefully examined the Motion, which has been on the Order Paper for a considerable time. I know that my hon. Friend feels strongly about it, but I cannot find time to discuss it in the week after next.

Mr. Dudley Smith: Would the right hon. Gentleman consider providing time for an early debate on parliamentary reform so that those who have come into Parliament since the beginning of this Parliament, and who are almost exclusively on this side, can have an opportunity of expressing an opinion on the way in which parliamentary democracy in this country is being undermined?

Mr. Peart: I cannot accept that our parliamentary democracy is being undermined. I agree that the subject is of importance. As the system develops, reforms and procedures which have been changed and accepted must be examined by the House. I agree that, later, the House should properly debate the matter.

Mr. Philip Noel-Baker: On an earlier occasion my right hon. Friend gave a

half promise that we would have a debate on the urgent matter of Vietnam. Can he now make that a firm commitment?

Mr. Peart: I cannot commit myself for the week after next. I appreciate that there is strong feeling on this subject. While it would not be possible to have a major debate on foreign affairs— Vietnam is foreign affairs—I will convey my right hon. Friend's view to my right hon. Friend the Secretary of State.

Mr. Bryan: Is the Leader of the House aware of the explosion of protest which greeted the latest brainwave of the Postmaster-General to discontinue the issue of comprehensive London telephone directories? When may hon. Members have an opportunity to express their views on this matter?

Mr. Peart: I do not know whether it was my right hon. Friend's brainwave, but I regret that a debate on that issue cannot take place the week after next.

Mr. James Griffiths: May I urge my right hon. Friend not to become overanxious about criticisms of reforms in parliamentary procedure? Will he take it from me—and this will be supported by hon. Members who have served in the House for many years—that in olden days we used to spend fruitless hours and days discussing details of Finance Bills which would have been much better discussed upstairs? Will he—

Mr. Speaker: Order. The right hon. Gentleman must ask a Business question.

Mr. Griffiths: Will my right hon. Friend find time for two debates; first, on parliamentary reform, a matter which concerns all hon. Members—and may we have a statement on this matter shortly after the Recess—and, secondly, on the tragic situation in Nigeria, for which we have some responsibility? Will he do his best to provide even a half-day's debate for this subject because we all desire to promote peace among these people?

Mr. Peart: I will certainly convey my right hon. Friend's comments about Nigeria to my right hon. Friend. I know that my right hon. Friend, from his experience feels strongly about this matter. To answer his other question, about providing time for debating the subject of Parliamentary reform. I agree that we


should debate this issue at some future time. I assure my right hon. Friend that I, too, regard this as an important matter, since we are all anxious to make Parliament work as efficiently as possible.

Mr. Boyd-Carpenter: Can the right hon. Gentleman either confirm or deny whether it is his intention to use some of the time which he has saved by guillotining the Finance and Transport Bills by providing time for such Private Members' Bills as the Government favour, and, if so, which?

Mr. Peart: No time has been saved, so I cannot answer the right hon. Gentleman's question.

Mr. Moyle: May I press my right hon. Friend further on the question of providing time for a debate on parliamentary procedure? Is he aware that such a debate would give hon. Members on this side of the House a chance to refute many of the statements that have been made, including the one made by Lord Carrington on 22nd May, in which he said that we were undermining this democratic Chamber by passing illdigested legislation? [HON. MEMBERS: "Hear, hear."] Is he aware that the only impediment to our legislation being fully digested by hon. Gentlemen opposite is their uncontrolled loquacity on the subject of dinner hours and shirt sleeves?

Mr. Speaker: Order. We are not debating the issue now. The hon. Gentleman must ask a question about the business of the House.

Mr. Peart: I am aware that my hon. Friend and others feel as he does, but I regret that I cannot find time for such a debate the week after next.

Sir T. Brinton: The right hon. Gentleman has several time brushed aside the vital question of the protection of the existence of Parliament. Is he aware that it is his duty to protect not only the interests of private Members—

Mr. Speaker: Order. I, too, wish to protect hon. Members. The hon. Gentleman must ask a Business question.

Sir T. Brinton: Is it not the right hon. Gentleman's duty to protect not only the privileges of private Members, but also the operation of Parliament? Is he aware of a Question on the Order Paper—

[Interruption.]—about introducing administrative action in advance of legislation, that we have had Guillotines and that we are being reduced—

Mr. Speaker: Order. This is Business question time. The hon. Gentleman must ask for something to be debated.

Sir T. Brinton: I do not know whether this arises on Business questions, but I am speaking of the business of the House. Is it not the right hon. Gentleman's duty to protect us against being prevented from discussing the business of the House, which is legislation?

Mr. Peart: As an old Parliamentarian, I am always glad to protect Parliament. The procedures which we have, and which have been improved, are to help hon. Members.

Mr. Dalyell: In view of the publication in the past fortnight of two significant far-reaching reports on football and athletics, will it be possible for the first Commons debate on sport to take place since the Minister who is responsible for sport had his job created in October. 1964?

Mr. Peart: My hon. Friend has raised an important point and, incidentally, I am sure that we all approve of the success of Manchester United last night. Sport is important, but I am unable to find time for it to be debated the week after next.

Sir D. Renton: In arranging future business, will the right hon. Gentleman ensure that there is always a member of the Government with Departmental responsibility present in Standing Committees when the affairs of the Department are being discussed, and so avoid the situation on the Race Relations Bill this morning in Standing Committee when, while we were discussing employment, the Under-Secretary of State for Employment and Productivity could not be present because he had been up all night on the Prices and Incomes Bill? Will the right hon. Gentleman—

Mr. Speaker: Order. The right hon. and learned Gentleman must not pursue the matter in detail.

Sir D. Renton: I am asking that the situation which arose this morning should be avoided in arranging future business.

Mr. Peart: The right hon. and learned Gentleman's point is not a matter for the business of the House for the week after next, but I will certainly examine most carefully the complaint he has made. If he will have a word with me later we can discuss the matter in more detail.

Mr. Molloy: As parliamentary procedure has been ruthlessly exploited by the Opposition for purely party political advantage—[HON. MEMBERS: "Rubbish."]—a system which they found so perfect when they were in power, would not my right hon. Friend agree that an opportunity should be provided for hon. Members on both sides of the House, and particularly those who support the Liberal and Labour Parties, to refute some of the gross charges which have been made about our parliamentary system?

Mr. Peart: I believe that we may be able to afford an opportunity for this matter to be debated, but I fear that will not happen the week after next.

Mr. Marten: Has the right hon. Gentleman seen Motion No. 266, which stands in the names of 96 right hon. and hon. Members, to which many other names will no doubt be added after the Recess? Since it deals with the reasonable and wise proposition that this country should study an alternative in the Atlantic Free Trade Area, will he provide time for the Motion to be debated?

[That this House, taking note of the present state of the negotiations to join the Common Market, believes that Her Majesty's Government should, in the meantime, begin a feasibility study of an open-ended Atlantic Free Trade Area initially comprising the United Kingdom, the European Free Trade Association, Canada and the United States of America.]

Mr. Peart: I have looked carefully at that Motion. I recognise that many hon. Members on both sides of the House feel strongly about the matter. However, I cannot find time for it to be debated the week after next.

Mr. Roebuck: In view of the unwarranted and totally unmeritorious complaints which have been made by some hon. Gentlemen opposite about ill-digested legislation, may I press my right hon. Friend to provide time for an early debate on procedure so that the country

may be told by many of us that those who are making these allegations about ill-digested legislation are often not in the House long enough to digest a glass of water?

Mr. Peart: I appreciate what my hon. Friend is saying, but I cannot find time for the matter to be debated the week after next.

Mr. Goodhart: Will the right hon. Gentleman promise that we will not be faced with a guillotine Motion on the Prices and Incomes Bill when we return?

Mr. Peart: This is a matter which every Government must judge in the circumstances—[HON. MEMBERS: "Oh."] I hope that, by good sense and voluntary co-operation, which, unfortunately, we did not have on a previous occasion, we may be able to proceed without any measure of that kind.

Mr. Raymond Fletcher: Will my right hon. Friend reconsider his refusal to provide time to debate the North Atlantic Free Trade Area proposal? Is he aware that such a debate would provide some of us with our only opportunity to demand a recount on the earlier Common Market vote?

Mr. Peart: I am aware of the strong feelings held by many of my hon. Friends on this issue, but I cannot find time for it to be debated the week after next.

Mr. Clark Hutchison: Can the right hon. Gentleman say what legislation he will repeal next week?

Mr. Peart: I cannot answer that.

Mr. Maclennan: In view of the extreme financial predicament of the International Development Association, can my right hon. Friend say whether legislation will be forthcoming to enable us to play our part in replenishing the resources of that organisation?

Mr. Peart: While I appreciate that my hon. Friend feels strongly about this matter, I cannot find time for it to be debated the week after next.

Mr. Dance: Has the Leader of the House noted Motion No. 320, relating to the reintroduction of the death penalty for the murder of police or prison officers?

[That this House is of the opinion that capital punishment should be reintroduced for the crime of murder of police or prison officers in view of the long series of attacks on police and prison officers, culminating in the four cases of alleged stabbing that occurred in Peter-head Prison on 27th May, 1968.]

In view of the grave anxiety in the minds of many people, and the obvious danger to police and prison officers, will he give an assurance that the House will discuss this matter soon after the Whit-sun Recess?

Mr. Peart: I cannot give an assurance that it will be debated during the week after next.

Mr. Abse: Will the Leader of the House note that the answers he has given to the hon. Member for Cardiff, North (Mr. E. Rowlands) and the hon. Member for Wolverhampton, North-East (Mrs. Renée Short) are very unhappy replies. Is he not aware that the fact that a Department may have some diffidence in wanting to discuss a number of prison reports, and that decisions and announcements are being made outside the House, may be an additional reason why he, as Leader of the House, should protect the Estimates Committees and make certain that there is a full debate on prisons?

Mr. Peart: My hon. Friend knows full well the history of this matter. Although the original debate was curtailed, I cannot find time during the week after next.

Mr. Patrick Jenkin: Will the Leader of the House ask the Chancellor of the Exchequer to take an early opportunity to explain the details of the very important Estate Duty concession which the Financial Secretary announced in the Standing Committee on the Finance Bill last night and which, in view of the operation of the Guillotine, he was entirely unable to explain to the Committee?

Mr. Peart: This is a matter which is on a much more detailed point than the business of the week after next. I will convey the hon. Member's point to my right hon. Friend.

Mr. Michael Foot: On a point of order. Will it not become a serious abuse of the procedures of the House, which we are asked to respect, if again

and again references are made on Thursday afternoons to procedures in Committee? It could mean that the Business question time could become interminable, which would be a serious infringement of the rights of hon. Members.
May I ask you, Mr. Speaker, to rebuke those hon. Members who seek to refer to proceedings in the Committees? This practice results in endless exaggeration and the infringement of the interests of most back benchers.

Mr. Speaker: There is quite a lot in what the hon. Gentleman says. Business question time is stretching out, and it hurts the business ahead.

Mr. Heath: Further to that point of order. Is it not also correct that there is no opportunity for hon. Members to raise questions of business in Committees, for which the Leader of the House is in any case primarily responsible? He is responsible for the whole of the business of the House, whether on the Floor of the House or in Committee, and, therefore, we cannot in any way have our rights limited in this matter.

Mr. Speaker: I made the real point earlier, that we could not pursue a Committee matter in detail. We could raise on the Floor of the House, as has been done, something affecting the business arrangements of the Committees concerned. The right hon. Gentleman is quite right. I am, however, concerned about the length of business question time.

Mr. Albu: Could we not in future refer business questions to a Standing Committee upstairs?

Mr. Edward M. Taylor: Will the Leader of the House try to persuade the Secretary of State to make a detailed and comprehensive statement next week about the proposed siting of the aluminium smelter in Scotland, in view of the anxiety which is felt in Scotland about the long delay?

Mr. Peart: I will convey the views of the hon. Gentleman to my right hon. Friend.

Mr. Fletcher-Cooke: Could the Leader of the House say whether the recommittal of the Committee stage of the Finance


Bill will take place in the week after the business which he has announced?

Mr. Peart: It is not for me to comment upon that until nearer the time.

Mr. McMaster: Would the Leader of the House consider setting aside two days for a debate on foreign affairs, so that, among other important issues, the present unsatisfactory state of diplomatic relations with China can be fully considered by hon. Members?

Mr. Peart: I have already said that I will convey this request for a debate to my right hon. Friend.

Sir C. Taylor: Would the Leader of the House now take us into his confidence, and say when we may hope for a General Election?

Mr. Peart: Not next week, or the week after.

Mr. Hastings: On a point of order. I seek leave to move the Adjournment of the House under Standing Order No. 9—

Mr. Speaker: That cannot be done at this stage. There is still a statement to come.

Mr. John Hynd: We have had a point of order raised already on the abuse of Business question time. The last question from the other side was another such question. It was purely a propaganda point which had nothing to do with the programme of the House. Should not some indication be given to hon. Members that Business question time should be used more speoifically on questions on the forthcoming business?

Mr. Speaker: The indication was given.

ARMED FORCES (PAY)

The Secretary of State for Defence (Mr. Denis Healey): With your permission, Mr. Speaker, I should like to make a statement on Forces pay.
In accordance with the standing reference of Forces pay made to the National Board for Prices and Incomes under Section (3)(1) of the Prices and Incomes Act, 1966, the Board has made a First Report (No. 70).
This recommends that pay should be increased by 7 per cent. with effect from 1st April, 1968, which is two years since the last increase; and that this increase should be treated as a global sum within which the Ministry of Defence should be free subject to the usual Treasury agreement, to make appropriate adjustments and minor changes in pay scales.
The Board also recommend that the out of quarters marriage allowance should be increased by 3s. a day for all ranks.
The Government accept these recommendations and these increases in pay and marriage allowance will be paid as soon as practicable.
The Government welcome the Board's intention to undertake a thorough-going review designed to examine the feasibility of evaluating service jobs and comparing them with those in civil life by methods which will reduce to the minimum the necessity for subjective judgment; and, as a related question, to examine the basic structure of Service pay and allowances, having regard to the implications of possible changes for manpower policies—Chapter 1, paragraphs 2 and 3 of the Board's Report.
The Government have asked the Prices and Incomes Board to complete its review within a year in order that, consistently with current incomes policy, any new system of pay that may be desirable in the light of this review, can be introduced as soon as practicable.
The review will take into account the questions in Chapter 4 of the Report regarding the pay of doctors and dentists in the Armed Forces.

Mr. Ramsden: The Government have replaced the well understood and well tried Grigg procedure by this standing reference to the Prices and Incomes Board. Is the right hon. Gentleman aware that the House will want to be reassured that the new system is as fair to the Services as was the old one in respect of pay, and, also, that it will produce the desired results in recruiting?
Does the 7 per cent. fully reflect the movement of comparable civilian rates, as the Grigg award would have done? Secondly, if it does not, ought it not to have done so, in fairness to the Services? Is not the right hon. Gentleman risking a dangerous recruiting situation,


bearing in mind that at the moment recruiting is down by about 25 per cent. on the figures for last year?

Mr. Healey: I am grateful to the right hon. Member for his questions. I and the Government are determined that any new system which is adopted to replace the Grigg formula or, as I would prefer to say, to improve the Grigg formula— because the central problem is to find a better basis for determining the comparability than the rather crude system used under the Grigg formula—should be fair to the Services, and play its part in ensuring that we have the necessary number of recruits.
On the question of whether the present award reflects the Grigg formula, as the Report makes clear, it does not fully reflect the Grigg formula, and it must be regarded as an interim increase. When a new system has been fully worked out —and we have asked the Board to complete this within a year—in the light of that report the Government will make a decision on any further increases which may be required under the new formula which is adopted.

Mr. Orme: Could my right hon. Friend answer a question on the 7 per cent? Am I to assume that the two years referred to is at 3½ per cent. per year? Is this the basis on which he is recommending acceptance of the award? If so, will it be in order to take this as a principle for civilian employees in industry to aggregate on this basis? Would this justify engineers, who have not had an increase for three years—

Mr. Speaker: Order. The hon. Member cannot comment on issues outside the statement.

Mr. Orme: I am sorry, Mr. Speaker. I was trying to say that the Minister is justifying this within the scale of pay policy of the Government at the moment. With respect, I think that it is a justifiable point to make on aggregation that if this applies—and I am not disagreeing with it applying—to Her Majesty's Forces the same principle should be applicable to civilian personnel.

Mr. Healey: I do not see that it is for me to enter into questions regarding any award which may or may not be made in regard to other groups, including

civilian groups, but my hon. Friend will be aware that 3½ per cent. is the ceiling under prices and incomes policy. By no means all groups of people are justified in obtaining the ceiling.
My hon. Friend will see that the Prices and Incomes Board considered very carefully the argument against making an award of this size, but it decided on the information provided by the Ministry of Defence that in this particular case the full ceiling permitted under prices and incomes policy was justified.

Captain W. Elliot: Would not the Minister agree that the nature of the machinery at present in operation to review Service pay is such that any award is in the nature of a catching up operation and the Services can never be a pace setter? In those circumstances, is it not deplorable that the Government should shuffle of this responsibility to the Prices and Incomes Board instead of taking the decision themselves, thus leading to all this uncertainty and doubt which has bedevilled the Services over the last few months?

Mr. Healey: My impression, and I have seen a great deal of the Services in theatres abroad particularly in recent weeks, is that there has not been a great deal of uncertainty and doubt. The Services, having received an award due to them two years ago, believed that they would receive fair treatment on this occasion, as indeed is the case, but I recognise that there is a system which involves comparability on prices and incomes which have to be placed in a particular period.
As a personal opinion, I think that the question whether these increases should be awarded at annual or biennial intervals is a matter for close study. It will always be the Government's responsibility, having received a report, to decide whether or not to accept it and whether or not to modify or amend it.

Dr. Winstanley: Welcoming the Govment's ready acceptance of the recommendations, may I ask whether, in implementing these pay increases, the Minister will at the same time make appropriate adjustments to Service pensions, to prevent them falling further behind?

Mr. Healey: I think that I said in my statement that Service pensions are to be increased proportionately. That, of


course, is the pensions of those who retire from a given date—

Dr. Winstanley: Dr. Winstanley indicated dissent.

Mr. Healey: I am sorry. This was made clear in the Report, but not in the statement.

Mr. Dalyell: While making clear, as one who has not always agreed on defence policy with my right hon. Friend, that I would be one of those who believe that the men and women in the Services should have a proper reward for the service which they give the country, may I ask my right hon. Friend what his thinking is on the difficult problem of comparability of pay for skilled technical men, at a time when the Services need more and more of them?

Mr. Healey: This is the sort of question on which it would be very unwise for a Minister to make a snap judgment. The Grigg formula determined certain analogues which had to be applied. It is agreed on both sides of the House that that is not a perfect formula and requires revision both in the kind of changes in the trades in civilian life and in the structure of trades in the Services and in the light of the national economic situation, and so on. I welcome my hon. Friend's statement which, I think, would be echoed in all quarters of the House, whatever view on the size and rôle of the Services one holds—that when men join the Services they carry out these difficult and often ungrateful tasks and they should receive the rate for the job.

Mr. Powell: Pending the further review to which the Secretary of State referred, will he do something specially now for the medical and dental officers, in view of the way in which they have been treated in the last two years and the catastrophic recruitment situation?

Mr. Healey: Yes, Sir. Service doctors are to receive an increase of 7 per cent. along with all other serving officers, which, on the one hand, will retain the substantial differential which elevates them in income over other serving officers and, on the other, will do a great deal to restore the differential between them and doctors in civilian practice which the last award did something to reduce.

Mr. Raymond Fletcher: Does my right hon. Friend agree that the new procedure, as distinct from the Grigg formula, has a valuable advantage as it focuses public opinion on the complexity of the job the Service man has to do and the great degree of skill which he brings to that job?

Mr. Healey: I am grateful to my hon. Friend. That is the case.

Mr. Hugh Eraser: I wish the right hon. Gentleman good luck in improving Grigg. We thought it an improvement on previous matters and that it could not be improved upon. Can he assure the Services that there will be a further award next year? This is important because of the drop in recruiting, which, I think, is catastrophic.

Mr. Healey: I can assure the Services that we have asked the Prices and Incomes Board to make its report within a year so that we can introduce whatever changes in the light of that report are to be made as soon as practicable, but I obviously cannot go beyond that in making a firm commitment. There was another point made by the right hon. Member for Stafford and Stone (Mr. Hugh Fraser).

Mr. Hugh Fraser: The present recruiting figures are catastrophic.

Mr. Healey: The interesting thing is that the morale of the Services is very high. This is attested by the fact that the re-engagement figures have not deteriorated as much as recruiting. In the Navy these have actually improved during the last 12 months. This rather suggests the problem is the civilian view of what Service life is like. Hon. Members opposite share some responsibility for seeing that the civilian population have the same view of the Services as those who are in the Services.

Rear-Admiral Morgan Giles: Although we have not the details of the increase yet, can the right hon. Gentleman answer some specific questions? First, because of the reference to the P.I.B., which presumably involves the disappearance of the Grigg formula, will he assure the House that whatever is involved Servicemen will be given a date each year, or each two years, on which


they know that their Service pay will be reviewed? The great merit—

Mr. Speaker: Order. Questions must be brief.

Rear-Admiral Morgan Giles: The second point was—[HON. MEMBERS: "No."] The second point on this 7 per cent. is that the Secretary of State said that the awards were definitely retrospective. The 7 per cent. does not appear to equate to the extent to which average earnings have risen in the last two years. From July, 1965, to July, 1967, according to the Minister of Labour Gazette, they rose 104—

Mr. Speaker: Order. We cannot debate this issue now. Mr. Healey.

Mr. Healey: Mr. Healey rose—

Rear-Admiral Morgan Giles: Rear-Admiral Morgan Giles rose—

Mr. Speaker: Order. The question has been long enough. Mr. Healey.

Rear-Admiral Morgan Giles: Mr. Speaker. I am asking the Secretary of State, as quickly as I can, a few specific questions on the announcement he made to the House. Am I not in order to include more than two points?

Mr. Speaker: The hon. and gallant Member must understand that Mr. Speaker's job is to protect the business of the day, the right of an hon. Member to put questions, and the right of other hon. Members to put questions. Mr. Speaker must insist on questions being of reasonable length. I think that the hon. and gallant Member has had a reasonable length of question.

Mr. Healey: On the second question asked by the hon. and gallant Gentleman, he will see the answer if he reads the Report, which has been in the Vote Office since 3 o'clock.
As for his first question, I echo what was said earlier by another hon. and gallant Gentleman. Undoubtedly, the Grigg formula was a great improvement on the previous way of fixing Service pay. I hope that the new formula will be an improvement on the Grigg formula —not a departure from it, but an improvement on it. I cannot at the moment say whether it will include a fixed date at a yearly or two-yearly interval. This is all for the Prices and Incomes Board

to determine in the light of the evidence that it receives from, among others, the Ministry of Defence and representatives of the three Services. I take his point that it is essential to give the men and women in the Services the knowledge that they will receive a fair increase in their incomes at fair intervals.

Mr. Heath: Will the Minister address himself to the question of recruitment, not re-engagement? Just now he said frankly that this award put the Serviceman at a disadvantage compared with his civilian equivalent, and he is falling further behind. At the same time, recruitment for the first five months of this year is about 25 per cent. down. How will an award of this kind get him the recruits that he must have? Is it not clear that the Prices and Incomes Board settles these matters on the basis of an incomes policy without regard to the need for recruitment?

Mr. Healey: That is not so. The right hon. Gentleman would do well, before making these wild accusations, to read what the Board says in its Report. In fact, it took carefully into account the needs of the Government's prices and incomes policy, on the one hand, and the needs of the Services, on the other. It makes it clear in its Report that if it had taken only the former into account it would not have made an award as high as 7 per cent. It was only because it took the special needs of the Services into account that it made the proposal, and the Government accepted it.
It will do a great deal to stimulate recruitment. But the one factor that affects recruitment is partisan propaganda, whatever its source, that there is no future in the Services. Some hon. Members opposite have a good deal of responsibility for giving that impression to the civilian. It is one which I am proud to say is not shared by the Services.

Mr. Heath: Is the Minister satisfied that the award will get him the recruits that he needs?

Mr. Healey: No, Sir. I am not satisfied. Nor have any Government ever been satisfied that monetary reward will necessarily always produce the number of recruits in the categories required at any given time. The important matter is to give people who might be attracted to a


Service career not only the sense that they will receive sufficient monetary recompense for their services, but also the feeling that the job is worth while and has a future. All of us have responsibilities here, and some are carrying them better than others.

Rear-Admiral Morgan Giles: On a point of order, Mr. Speaker. Would it be in order for the Minister to deal with the second of the two points that I was able to ask him, about the 7 per cent.?

Mr. Speaker: It is for the Minister to answer in the way that he wishes.

Several Hon. Members: Several Hon. Members rose—

Mr. Speaker: Order. Point of Order. Mr. Biggs-Davison.

RHODESIA (UNITED NATIONS RESOLUTION)

Mr. Biggs-Davison: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
the vote cast in the United Nations Security Council by the British representative in favour of a Resolution imposing even harsher mandatory sanctions on Rhodesia and, in particular, the new and dangerous situation arising from the call contained in that Resolution to all members of the United Nations to render moral and material assistance to the people of Southern Rhodesia in their struggle for freedom and independence.
I submit that the statement that we have had from the Commonwealth Secretary indicates that this is a specific matter; and some of us at least have had access to an official text of the Resolution. How can its importance be denied?
The importance of the matter was shown by the feeling that ran so high when the Commonwealth Secretary made his statement and by the feeling that we all experience in our constituencies, which is more sympathetic to our side of the House than to the other—

Mr. Speaker: Order. The hon. Gentleman must not drift into the merits of what he is asking the House to debate.

Mr. Biggs-Davison: As matters stand, the House separates tomorrow for Whitsun. Today, we have heard nothing

but lame and fuzzy interpretations of these ominous and dangerous words concerning the struggle in Rhodesia.
The urgency of the matter arises from the fact that, at this very moment, terrorism and guerrilla activity is going on in the Zambesi Valley, and, even if right hon. and hon. Gentlemen opposite claim that there is no connection between that and the words "moral and material assistance", contained in that Resolution—

Mr. Speaker: Order. The hon. Gentleman must not seek to argue the subject that he will argue if he gets his Standing Order No. 9 Adjournment.

Mr. Biggs-Davison: The criterion to which I seek to address myself is the urgency of the matter. The urgency arises from the fact that the situation is now being worsened by this Resolution, especially by the words to which I have referred. Whatever interpretation is put on them from the Treasury Bench, they will be interpreted as an incitement to bloodshed and an encouragement to a breakdown of law and order, which the Government have always professed to defend in a country for which they claim to be responsible.
This is a new departure, and the consequences are likely to be appalling to Africans of all races and to all those whom we represent. I submit that we as a House would be deficient in our duty to our constituents if we did not seek to discuss, possibly this evening, a disastrous new course entered upon in the name of international peace and security but calculated to lead to massacre, anarchy and war.

Mr. Speaker: The hon. Member for Chigwell (Mr. Biggs-Davison) asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
the vote cast in the United Nations Security Council by the British representative in favour of a Resolution imposing even harsher mandatory sanctions on Rhodesia and, in particular, the new and dangerous situation arising from the call contained in that Resolution to all members of the United Nations to render moral and material assistance to the people of Southern Rhodesia in their struggle for freedom and independence.
The House will remember that, under the revised Standing Order No. 9, agreed to on 14th November, 1967, Mr. Speaker


is directed to take into account the several factors set out in the Order, but to give no reasons for his decision.
In the light of the new conditions, I have to rule that the hon. Gentleman's submission does not fall within the provisions of the revised Standing Order, and, therefore, I cannot submit his application to the House.

Sir Knox Cunningham: On a point of order, Mr. Speaker. Without in any way wishing to challenge what you have said, may I raise this point with you? Tomorrow, we adjourn for the Recess. Tomorrow is a Friday, when we shall have

Adjournment debates. Under the new procedure, is it ever possible to have a Standing Order No. 9 Adjournment on the penultimate day, in those circumstances?

Mr. Speaker: The simple answer is that it is possible under Standing Order No. 9 to have a Standing Order debate on a penultimate day. If the hon. and learned Gentleman reads the Standing Order which governs it, he will see that there are two kinds of debates possible. The first is one of extreme urgency, which is given that very day, whereas the normal procedure will be to give it for the next day.

ANISATIONS BILL [Lords]

Motion made, and Question proposed,

That the International Organisations Bill [Lords] be referred to a Second Reading Committee.—[Mr. Peart.]

Mr. John Wells: Can the Leader of the House give us an assurance that the Bill—

Mr. Speaker: Order. I understand that under the Standing Order this is not debatable.

Mr. Wells: Mr. Wells rose—

Mr. Speaker: Order. This is not debatable.

Mr. Wells: On a point of order. I understand that the Civil Aviation Bill [Lords] ran into considerable difficulty in Committee because it was originally thought to be non-controversial and was sent to a Second Reading Committee in this way. Perhaps it should not have been sent there, because it appears that it was controversial after all.
May I have your guidance, Mr. Speaker, as to whether this Bill, which the Leader of the House now seeks to send upstairs for its Second Reading, should be so sent?

Mr. Speaker: Order. The hon. Gentleman must read the Standing Order on the procedure. This is not debatable.

Question put and agreed to.

Orders of the Day — INDUSTRIAL EXPANSION BILL

Lords Amendments considered.

Clause 2

CONTENTS OF SCHEMES

Lords Amendment No. 1, in page 2, line 21, after "form" insert:
(other than the provision of equity capital)

read a Second time.

4.48 p.m.

The Minister of Technology (Mr. Anthony Wedgwood Benn): I beg to move, That this House doth disagree with the Lords in the said Amendment.

Mr. Speaker: Order. I should call the attention of the House to the fact that privilege is involved in the Lords Amendment, and that I have not selected the Amendment to it in the name of the hon. Member for Yeovil (Mr. Peyton) at the end to add "with voting rights".

Mr. Benn: There are two Amendments on the Order Paper that have been made in another place, and although each will have to be taken separately I wonder whether, if it is agreeable to you, Mr. Speaker, and the House, we might debate them together, because they relate to the same point, the one being consequential on the other.

Mr. Speaker: I have no objection.

Mr. David Price: I think that clearly there is an overlap between the two, but as I shall try to show if I catch your eye, Mr. Speaker, there is a certain difference of emphasis in the position as the Bill has been drafted. I should have thought that it might be possible to deal with the second one in its particular aspects, but the general arguments on the first apply to the second.

Mr. Speaker: Order. That being so, we shall take them separately.

Mr. Benn: The points contained in the Lords Amendment were fully debated in Committee and were the subject of an Amendment there. We also fully debated on the Floor of the House the desirability or otherwise of providing in the Bill for the appropriate Minister to take an equity


holding in a firm which would feature in an industrial investment scheme. If it were passed, the Amendment would deny the House the opportunity to approve in any Orders that might come forward even a scheme which received the support of the firms; and was sponsored by the Minister, if such a scheme included any equity investment.
Since the matter has been so fully debated in the House, I urge the rejection of the Amendment.

Mr. Terence L. Higgins: My recollection may be faulty, but I understand that we did not debate this precise Amendment in Committee. Could the right hon. Gentleman give us the reference he has in mind?

Mr. Benn: The point in question was the right of the Minister under an industrial investment scheme to purchase equity. That is the heart of the Amendment and the subject was very fully debated on Second Reading and in Committee. That debate was not on an identical Amendment, but the substance was the same. I do not think that it would be right for me to detain the House in speaking further about the Amendment.

5.15 p.m.

Mr. David Price: We on this side of the House agree with the Lords in the Amendment, and therefore disagree with the Government's opposition to it.
The right hon. Gentleman is not quite correct in saying that we went in great depth into the proposal that their Lordships have put before us on Second Reading, in Committee or on Report. If he looks at the OFFICIAL REPORT of our Committee proceedings I think that he will bear me out in saying that we discussed the preamble in Clause 2(2), to which the Amendment relates, in very general terms, and that we did not debate the second Lords Amendment at all in the terms in which it is phrased. But I suspect that I would be out of order if I discussed what we do on the second Amendment before we come to it.
In Clause 2(2) the Government have laid out their financial proposals for the implementation of the Bill in two forms— what one might call the braces and the belt. The preamble before paragraphs (a) to (f) is what I would call the braces, and

it is that that another place is attempting to amend. When we come on to the specific methods by which the Government are empowered to finance industrial investment schemes, we find the equivalent of the belt.
The preamble is in very general terms, allowing
… a competent authority to provide financial support in any form for the purposes of a project …
and so on. We took exception in Committee to this omnibus power. Their Lordships seem to have accepted, whereas we did not, the omnibus nature of the powers, but they have tried to restrict it in one respect, which we are now debating, in that it should not apply to equity capital.
I do not wish to detain the House unnecessarily, but the right hon. Gentleman is not quite correct to say that we debated this question in this form. We were anxious to take the whole of this general provision out and rest content on the specific powers in paragraphs (a) to (f). As the right hon. Gentleman has not vouchsafed us a great deal of insight into his thinking on why we should disagree with their Lordships, I shall have to rest my case on the arguments of the Government spokesman in another place, the Paymaster-General and Leader of the House of Lords, in trying to resist the Amendment. He said:
… Government shareholding would provide the best possibility of a proper return on the taxpayers' investment, including an equity investment."—[OFFICIAL REPORT, House of Lords, 27th May, 1968; Vol. 292, c. 999.]
That is a most interesting argument when one takes it in the context of the purposes of the Bill. The Government invest under Clause 2(1) when an industrial investment scheme
… would not be undertaken without such financial support as is authorised by this section.
Yet the Paymaster-General deployed the argument that using this method of taking equity will provide the best possibility of a proper return on the taxpayers' investment. This seems to be a rather peculiar argument. The object of the Bill is not to set up an investment trust for taxpayers in order that they may get a proper return. The objects are laid down in Clause 2(1) as follows:

"(a) to improve the efficiency and profitability of an industry or section of an industry;


(b) to create, expand or sustain productive capacity in an industry or section of an industry; or
(c) to promote or support technological improvements in the processes or products of an industry or section of an industry,"

There is nothing about the purpose of the Bill being to get a better return on taxpayers' investment.
The Government's case seems to rest on the proposition also that Governments can spot winners where the private sector fails to spot them. Again I remind the House that this is not a general provision for Government investment wherever they want to do it. It is clearly stated that the Government will give financial support where the scheme would not go ahead unless such support were made available. That is a limiting provision.
We are looking at a particular form of investment. In these circumstances, it is singularly risky to put taxpayers' money into such a scheme in the form of equity capital. The very reverse of what the Paymaster-General thinks will happen. The taxpayer is more likely to lose his money because of this provision, which would circumscribe the whole objective we are discussing. On 15th October, the Observer—which I am sure hon. Members opposite will not regard as being a Tory newspaper, for it normally lends support to the Government—had an article by Mr. Anthony Bainbridge, which said
The willingness to take risks clearly fluctuates from country to country and period to period. After the series of economic crises Britain has suffered—each one worse than the last—it is small wonder that our risk takers are inclined to caution. However, it is dangerous to conclude that Whitehall will be able to step in and spot those areas where a profit was wating to be picked. It would be better employed fashioning an economic climate that encouraged the taking of risks.
Hon. Members opposite entertain a peculiar myth about taxpayers investment, embodied in the words used by the Paymaster-General in another place. In fact, the taxpayer will have absolutely no say in the investment to be made under the Bill. It will be determined by Ministers without reference to the taxpayer's choice of investment. It is, as we have said, an unfair investment. Furthermore, I know that some hon. Members opposite take the view that, if Government money is to be used to support a commercial venture, the taxpayer is entitled to a return. We would agree

with that but we say that, in the very nature of speculative ventures, equity capital is the least efficient way of ensuring a proper return to the taxpayer.
It cannot be pointed out too often that the State automatically shares in the profits of every company, irrespective of whether it has had Government money or not, because the State takes 42½ per cent, of the profits in Corporation Tax. So the taxpayer is sharing the profits of every British company and in most cases without having the risk of investment in the form of equity. I quote the Paymaster-General again:
It is not the intention of the Government under the Bill to use the existence of the shareholding, whatever size it may be, to interfere in a company's day-to-day business."— [OFFICIAL REPORT, House of Lords, 16th May, 1968; Vol. 292, c. 424.]
In many ways I am glad to read that, but one of the arguments which might have been used by the Government—and I am surprised that it is not—is that there are companies of a speculative nature which they feel are in the national interest but which do not appeal to the market, probably because the market has not sufficiently high confidence in the management, whereas the Government have. If the Government take a sizeable stake, they surely will want some control over policy. Those words of the Paymaster-General are no reassurance to me that our arguments against the Government taking equities are diminished.
There is also the idea that, in order to promote faster economic growth, higher productivity and greater technology, somehow or other public ownership makes the activities of a company more acceptable.
Then there is the idea that, where the State owns equity in a company, the individual citizen has a personal stake in that company—that, in some personal sense, he feels that its activities are more real to him and that he is participating in it. This, too, is a complete myth. It is the sort of primitive belief which was held, no doubt with great honour, by some of our earlier Socialists before State Socialism was seen working in action. That argument is far removed from popular reality, whether of the old right or the new left. It is also a long way removed from the interesting proposals which the right hon. Gentleman made last weekend about how one moves towards


what he called a participating democracy. Most of us have publicly owned industries in our constituencies. But do my constituents feel that they own the Southern Region of British Railways in any personal sense?

Mr. Dudley Smith: Many of them wish that it were in the hands of private enterprise.

Mr. Price: I agree with my hon. Friend but I do not want to elaborate on that. We can all give examples from our own constituencies. To my mind, the idea of Government ownership of equity in private industry not only does not advance the right hon. Gentleman's interesting proposition about participating democracy but moves in the other direction. I may say that I was myself very interested in some of the propositions the right hon. Gentleman put in his speech.
These are general objections to Government equity, but if one is to have an equity stake in a company one ought to have views on how it operates. This is particularly so if one is an investor on the scale; of the Government or of an institution. If a large investor does not have views, certainly at policy level, about how a company should be run, one gets the irresponsible ownership that is often criticised by hon. Members.
Let us look at the scale of the Government's activities. They produce a Budget of about £11,000 million a year. Compare that with our largest employer, I.C.I., which has a turnover of barely £900 million. It does not suggest that there is a great deal of attention and effort by the Government to put their minds to playing a part actively in companies in which they have an equity stake.
On a strictly pragmatic level, I challenge the competence of Government to run industry. Under this Government or any predecessor or successor, I believe that the evidence is in the direction of the fact that Governments are incompetent to run industry. My right hon. Friend the Member for Leeds, North-East (Sir K. Joseph) said on Second Reading:
We wish to repeat, and repeat again, that the public sector is inherently likely to be more inefficient than the private sector because it is not subject to the discipline of the market and because, in many cases, it is subsidised.

We object to the expansion of the public sector, particularly when it is subsidised."— [OFFICIAL REPORT, 1st February, 1968; Vol. 757, c. 1603.]
In supporting their Lordships today against the Government, we are reaffirming what my right hon. Friend said. That is not only our view but the view of many people outside who have had experience of this.

Mr. Deputy Speaker (Sir Eric Fletcher): Order. We are not having a Second Reading debate. We are dealing with a very limited Lords Amendment.

Mr. Price: I always bow to the Chair, but I would point out that this is a pretty major issue.

Mr. Deputy Speaker: At the same time, it is not a Second Reading debate. It is a rather limited Lords Amendment that we are considering.

Mr. James Scott-Hopkins: On a point of order. Might I draw attention to the disgraceful state of attendance to the debate. So far there have been two Ministers, a P.P.S. and one back-bench Member on the benches opposite. There is no quorum.

Notice taken that 40 Members were not present;

House counted, and, 40 Members being present—

Mr. Eldon Griffiths: Further to that point of order. I am disturbed about the Ruling that you, Mr. Deputy Speaker, appear to have given. My own view is that nothing could be more basic to the Bill than the Lords Amendment which has been returned to this House. I should be sorry if your Ruling were that we cannot discuss this fundamental matter of the control of equity shares in industry. This is surely basic to the Bill and raises issues between the two sides of the House.

Mr. Deputy Speaker: I appreciate that it is a very important Amendment. Provided the debate is confined to the relevance of the Amendment it will be in order. I thought that the hon. Member for Eastleigh (Mr. David Price) was proceeding to discuss the whole principle of the Bill and embark upon something more appropriate to a Second Reading debate. I agree that it is difficult to draw the line, but I thought it right to


draw the attention of the House to the fact that we are dealing with a Lords Amendment, not Second Reading.

Mr. William Hamling: Further to that point of order. Would not the hon. Gentleman be assisted in his project if his hon. Friend did not attempt to count the House out in circumstances when obviously there are innumerable Members in the House?

Mr. Deputy Speaker: I do not think that is a point of order.

Mr. David Price: I will try to assist the House in making further progress. I was coming to the inappropriate form of financing that the Government are proposing to restore to the Bill. I am in a difficult position, because I am trying to defend their Lordships' Amendment when we have not heard from the right hon. Gentleman why we should reverse their Lordships' decision. It makes it difficult. We can defend their Lordships' position on pragmatic as well as on general grounds.
To put the matter succinctly, I should like to quote briefly from an article by Mr. Ronald Grierson whose credentials, having been managing director of the I.R.C., are formidable and should bear weight with the House. In an article in The Spectator on 10th April last, talking of the inappropriateness of equity finance, he says:
The prudent financial view has always been that equities are a gamble and that, especially in risky situations—which by definition are those most likely to be proposed— the safe course is to be a creditor and, if at all possible, a secured one …
This puts clearly the point that I was developing earlier.

The Joint Parliamentary Secretary to the Ministry of Technology (Dr. Jeremy Bray): Will the hon. Gentleman read the rest of the quotation, where he refers to income-bearing bonds?

5.15 p.m.

Mr. Price: I would be delighted. I thought I was being reprimanded by the House and by hon. Gentlemen opposite for detaining the House too long. I have the full article, but I will not read it. Hon. Gentlemen opposite who are waiting for the next debate, I am sure,

would not be pleased if I read the whole of Mr. Grierson's admirable article.

Mr. Stan Newens: On the contrary, I should be delighted.

Mr. Price: I do not think that the hon. Gentlemen's hon. Friends outside would thank him for tempting me in that direction. Nor would you, Mr. Deputy Speaker.

Mr. Newens: I think that it is unjust of the hon. Gentleman to make that an excuse for not reading the quotation. I am sure that my hon. Friends will not object if he reads a quotation which enables the House to get to the nub of the matter.

Mr. Price: I can read a lot more. I am in your hands, Mr. Deputy Speaker. I will read the article:
One is thus left with the uneasy sensation that one of the prime motives behind the desire to take equity investment is a certain financial showmanship which has recently become manifest in Whitehall. There have always been those who eagerly wanted the state to share in what they regarded as the ' super-profits' of industry; to their numbers have now been added certain others who feel that it would redound to the credit of a Labour administration to pull off one or two spectacular financial coups.
It is highly questionable whether such an approach is really in the public interest. The prudent financial view has always been that equities are a gamble and that, especially in risky situations—which by definition are those most likely to be proposed—the safe course is to be a creditor and if at all possible a secured one; and that if one has to be an unsecured creditor, the lack of security should be compensated by some form of free profit-sharing. It is difficult to see why in the case of public money this sound financial principle should be stood on its head.
I suggest that the methods used by the N.R.D.C. are by far the best. I recognise that there is a certain area where private and public meet—a sort of interface—particularly concerning some of the industries for which right hon. and hon. Gentlemen opposite are responsible. I believe that the N.R.D.C. type of financing is most appropriate, not only in terms of the industry concerned, but also in terms of the taxpayer. Even more important, it enables a fairly limited quantum of public money to be recircu-lated. That cannot be done if the money is put down in equity, because, by definition, equity is permanent finance. One of the attractions of the N.R.D.C. method is that it is used as launching


aid, is then recovered and it can go into new projects. In terms of advancing the kind of schemes which I certainly wish to see Britain doing, the N.R.D.C. method is a much more productive use of any quantum of public investment than tying it down in equity. I could go into the computer merger case, but that might more appropriately wait for the next Amendment.
To conclude, we have had no reasons given by the Minister of Technology for rejecting their Lordships' Amendment. Convincing and persuasive though my arguments have been, even more persuasive has been the silence of the right hon. Gentleman.

Mr. Eldon Griffiths: The Minister's reasons for disagreeing with their Lordships, for all practical purposes, have not been given to this House. Therefore, my hon. Friend the Member for Eastleigh (Mr. David Price) was placed in the difficult position of having to demolish arguments on this Clause that were given in the other place. The Minister's view appears to be: "We have discussed all this. Their Lordships are wrong. We are right. That is the end of it." With respect, this is an impertinence.
In passing, it comes strangely from the right hon. Gentleman, who has been lecturing the country about participating in the democratic process, to tell us nothing, expect us to accept it, and regard himself as having done his duty. It is not good enough.
We are bound to rely upon the arguments advanced by his noble Friend in another place to understand the Government's reasons for disagreeing with the Amendment. I have read those arguments very carefully. I find that the arguments which led their Lordships to make this Amendment made absolute mincemeat of the Government's case. I can think of no better argument for the other place than this succinct and brilliant Amendment, which I support in every way. At the end of the debate in the other place the right hon. Gentleman's noble Friend described this Amendment as "a blot on the Bill." I regard the Bill as the blot and this Amendment as one of the few redeeming features of an otherwise extremely bad and unnecessary piece of legislation.
I suspect that I know why it is that the Minister has moved to disagree with the Amendment. Is it not possible that he has formed, or is about to form an international computer company, and that he is planning, or he may even have given undertakings, to take up equity capital in this company, on Government account, and furthermore that he has done all this in anticipation of Parliament agreeing to this Bill and specifically to this Clause, which has been amended? I do not mind a little bit of forethought or foresight on the part of Ministers— we have all too little of it now. But I object to the Government taking Parliamentary approval of this original Clause, as amended, for granted, and assuming that the House will simply rubber-stamp anything that the right hon. Gentleman says.

Sir Tatton Brinton: It would not be surprising if this were so, because it has been done twice recently. The first case was the Ombudsman and the other was decimal coinage. In both instances it was obvious that the Government had taken administrative action in anticipation of the certainty of Parliament legislating to make that action good.

Mr. Griffiths: I have no doubt that we shall come to this matter in greater detail on the next Amendment. I oppose this power that the Government seek to take equity capital. I agree with the Lords Amendment for other reasons than my suspicion of the arbitrariness of the present Minister.
I have two sets of objections—one practical and one political—to this power being given. To take the practical ones, if the Government take equity capital in the private sector, unlike a private investor they are unlikely ever again to be able to realise that investment. The Government are not in a position to sell those equities again on the open market. Why? Because Government holdings of these equities would almost invariably tend to be pretty large. A large quantity of equity capital will be taken up, and the problem of the Government unloading that equity capital on to the market would be very serious. Once word got out that the Government were selling off their equities then a lot of others would want to know why.
There would be a suspicion that the Government knew something about the company which made its equity capital less worth holding. Consequently there would be a run away from the remaining share of the company and the Government would find themselves holding equities which were less value on the open market. This is no way to protect the taxpayers' money, on the contrary it is a certain way to lose it.
On practical grounds, I say that by taking private equity capital in this fashion the right hon. Gentleman is putting Government money in a position where, almost invariably, it could not be got at again without loss. It is possible that the Government could seek to sell off their equities in dribbles and drabbles, so that no one would notice. This is exactly the kind of activity that I would expect of the present Administration. If they were to do that, it would take a long time. It might be, if they held a substantial number of shares, that it could take 5, 10 or 15 or more years. We have General Elections during that period, and I suggest to the right hon. Gentleman that he ought not to place a successor Government, and there will be one very shortly, in the position of holding shares which can be sold only at a loss.
My second practical objection to the Government taking over equity shares is that it is unnecessary for them to do so, even for the purposes set out in the Bill. The Government already take 42½ per cent, of all the net profits of all the companies, and therefore it cannot be the argument that they are taking up the shares simply in order to share in the profits. They can supply firms in need of money with capital in other ways. They already do so through an amplitude of Government agencies—the whole place is crawling with them. The Minister of Technology can provide capital if necessary; the Industrial Reorganisation Corporation can do likewise. There is massive Government aid to industries in the development areas of up to £250 million a year and there is the whole area of Government contracts.
There is no doubt that this policy could be achieved, and is being achieved, without the Government having to take up equities within private companies. This is the point their Lordships argued and this is precisely why this admirably short

and sensible Amendment should be in-porated in the Clause.
There is another objection going to the heart of the matter, a political objection. It is the difference between the two sides of the House and it could not be more effectively illustrated than by this short Amendment. I believe in private enterprise and that is why I support their Lordships in the words that they have sent back to us. I do not believe that there can be private enterprise if the Government get a lock on the equities. Industry does not want Government to take up equities in it.
The C.B.I, said:
We cannot see the need for this legislation in any way.
On the same point Mr. Grierson, former managing director of the Industrial Reorganisation Corporation, on 10th November, 1967, in the same journal from which my hon. Friend the Member for Eastleigh quoted, described the Bill and the point with which we are dealing as
… a form of gimmickry which elevates temporary expedient to a major principle of economic administration.
As I read those words I thought that they must be referring to the Prime Minister. They were, of course, referring to the right hon. Gentleman. The Institute of Directors, representing 50,000 firms, small and large, has said quite clearly that it is wholly opposed to the taking up by the Government of equity capital in private industry. Its objections are met in full by the Lords Amendment. The Amendment asks this House to keep the Government out of equities in order, above all else, to avoid the backstage arm twisting which would go on once Government directors were put on private boards.
5.30 p.m.
The Minister has said again and again that there will be no compulsion, but when one considers equity capital, what else can happen but the appointment by the Government of directors to sit on the boards of these private corporations? Once these directors are placed on the boards, they will not sit there like dummies. They will not act as lobby fodder. They will intervene actively in the policies of the corporations, otherwise they will be no good there at all. It is this arm twisting to which I object, and to which their Lordships objected so admirably.
My last: objection is that the acquisition of equity capital means, above all, State control. It means nationalisation by the dack door. It means the very process which has brought our country into its present difficult pass. It means a process —as we know on the railways, and in other respects—of large losses, bad service, high taxes, and a vast bureaucracy. These are the things to which the Government's proposals will condemn our country, and their Lordships have seen the wisdom of sending to this House a short, sharp Amendment to knock out this disease from our midst.

Mr. John Smith: I have not had an opportunity to speak on this subject before, but I am glad of it now because my constituency is the largest source of capital for industry. I speak about the Amendment in no partisan spirit, but simply with the experience of having worked in this principal source of capital for 20 years. It is inadvisable for the Government to hold an equity stake in companies. I do not believe that it is in the best interests of the taxpayer, or of the electorate, if it is possible to separate them.
There are arguments relating to control, and there are arguments relating to financial return or profit; it is the financial argument with which I shall deal first.
There is an assumption—I do not impute it to all hon. Gentlemen opposite —that equities are always the most profitable way to participate in a venture, but to dispel that one has only to think of Short Brothers and Harland, or the Beagle Aircraft Company, or, as we shall probably see, Fairfields, which are three out of seven or eight ventures in which the Government have a stake.
There is also an assumption that a company will always resist a Government holding of its equity. That is not so, because the less attractive a venture, the readier the company will be to accept Government money by way of equity. The projects which need Government encouragement are those which, by definition, are likely to result in a loss. If they were not likely to result in a loss, non-Government finance would be forthcoming from my constituency.
Indeed it seems curious for the Government to insist on a share in the profits when, by definition, the venture is more likely to result in a loss. Can the Government point to any instance in which a company has been unable to raise the necessary founds for a viable commercial venture? We have the best capital market in the world, and if a venture cannot be financed in that market, it is at least a good indication that it is not likely to be profitable.
Further, an equity in a loss-making venture is far more of a subsidy than is a loan. The attitude of some hon. Gentlemen opposite is that a loan is a subsidy to a company, but in fact an equity investment in a company is much more of a subsidy. There is no fixed rate of interest on an equity and an equity investment is a permanent investment and is not repayable.
Viewed from the Government's side as shareholder, if the venture fails the Government have lost the taxpayer's money anyway; and if it succeeds there are many obstacles and pressures—financial and political—which effectively prevent the Government from selling their shares. I do not place much stress on the financial obstacles. To say that the Government will be unable to sell their shares in a venture they have subsidised is in a way to criticise the capital market which could have put up the capital for that venture by saying that it now cannot absorb the shares. I therefore do not stress that argument, but the political arguments against the Government's selling their shares in a company are strong, and money put up by the Government in the form of equity capital has effectively gone for ever.
I do not think that permanence is a suitable feature for investment under the Bill. The purpose of the Bill is to get enterprises off the ground and over humps. In neither case is a permanent investment needed—or, very often, good for the company. There is many a company which has overloaded itself with capital.
Moreover—and this is a point which I have not heard made—a permanent investment by a Government is inflationary. Government lending, as opposed to Government borrowing, should be short, so that the additional money put into the system by the lending is withdrawn again


as soon as possible. I believe that that principle has always been recognised by the Treasury.
Further the Government are not a taxpayer. The attractions of equity investment are overwhelmingly to taxpayers, and an investor who is not a taxpayer, such as the Government, a pension fund, or a charity, has a built-in bias away from equities and towards fixed-interest investment.
To turn to questions of control, one can have an equity interest without a voting right. I have not checked it, but I believe that the Government took participation of this sort when Elliott-Automation was merged with English Electric. But a non-voting participation, for various reasons, is unlikely, and on the part of private investors it is very much discouraged.
Equities therefore will involve the Government in the awkwardness and odium of difficult, unpopular, and in some cases wrong decisions, such as for example the sacking of Mr. Wrangham from Short Bros. The existence of a Government shareholding undoubtedly discourages people from serving with such a company—and indeed it visibly discouraged them in the case of Short Bros.
Next, it is essential in any successful enterprise that the participants should all have the same objectives. In any company the objective of the shareholders and the directors is the long-term interests of the shareholders. I say "long term" because the long-term interest of the shareholders includes seeing to it that the company has a satisfied staff, satisfied customers, and indeed a satisfied public. Enlightened self-interest is what should drive shareholders on, to the benefit of the whole community. But self-interest is exactly what we do not want a Government to have in a company, because the Government may then be urged or forced to take actions which are not in the interest of shareholders as a whole, or indeed which have nothing to do with the shareholders at all.
Governments are bound, through ownership of parts of companies, to get into political difficulties. One has only to think of companies like British Petroleum or Fairfields or the Government's attitude to take-overs. At present, I think

rightly, the Government encourage takeovers, but they did not always do so, and they may not do so again. I wonder how the Government, as shareholders would have acted if they had been shareholders at the time of the take-over in A.E.I.; and subsequently as shareholders in G.E.C. when faced with all the confusion and troubles over the closure of factories. We shall have two sorts of shareholder and two sorts of director with conflicting voices, and there lies the certainty of trouble and the certainty of failure.
To sum up, if the Government wish to stimulate changes in industry—I do not want to debate that, but I do not accept it out of hand—it should be done either by way of loan, with interest rates high or low, with or with participation in profits—the Parliamentary Secretary's intervention implied that he did not see the distinction between an equity and a participating prior charge, and there may turn out to be no difference on the profits front, but there is a great difference in the other aspects which I have described —or by guarantee, with or without royalty or annexure arrangements, as has been done in the past. But if the Government proceed by way of equity, there is a risk of pushing Government orders to uncompetitive firms; a risk—many of us here will put pressure on the Government to do so—of preserving the status quo, of encouraging the ossification of industry to which we are all too prone; and a risk of financing prestige ventures.
Without wishing to be disagreeable, I view this part of the Bill as a piece of financial showmanship and I earnestly hope that the House will accept the Amendment.

Sir T. Brinton: I underline some of the points of my hon. Friend the Member for the Cities of London and Westminster (Mr. John Smith), who went to the heart of the matter. The Bill is wrongly named. It speaks of industrial expansion when it is about the financing of industry. If it is necessary for the Government to finance industry, there are several solutions. It can be done by loan, by grant, by providing fixed-interest capital or by equity.
This is the fundamental difference between Socialism and private enterprise. The Government will naturally always hanker for a share in the ownership of


industry. The Bill is not concerned with providing the finance to launch or encourage businesses but, as one stated object, to improve the productive capacity of existing industries. I cannot conceive that it would often be necessary for a Government to provide capital for this purpose. As has been said, they would be backing a hopeless loser.
5.45 p.m.
Once an enterprise has begun to show its paces, of course, the market will support it. On the whole, one would assume that the provision of capital would normally be a launching operation, but if the market was not satisfied that the enterprise would be profitable in the long run, why do the Government think that they would be better judges? I realise that they wish to take part of the risk capital and are assuming that this would be for the public benefit, but they would be better safeguarded by having fixed-interest capital secured on the value of the business so that something might be saved if the venture failed, rather than taking risk capital, which is inevitably lost if there is a failure, when fixed-interest shareholders often retain something.
The question of prestige always arises over a political interest in a company's success. Any Ministry which has put our taxpayers' money into an enterprise is bound to do its best to see that it succeeds. As a businessman, I deny that that would be done because the Government would provide some outstanding managerial ability. But what they can provide is an awful lot of pull and some push around the corners to assist enterprises in which they have taken an equity holding to produce success which those enterprises would not have earned in ordinary private operation.
This is the great danger. Belonging to the party that I do, I naturally believe in the separation between political and economic power and that the fusing of the two produces a dangerous result. The result of the Bill will be that the pushing up of an equity interest by the Government will eventually lead them to favour the firms concerned—possibly, even probably, uneconomically—merely to ensure that the enterprise shows an apparent success.
It is also likely that further money will be pushed in to assist that equity in the


form of extra loans or grants in order to show a success where none has been earned. I do not believe that Governments—I do not refer to this one in particular—are immune from the temptation to put nice goods in the shop window, even though they do not exist, by assisting unduly and uneconomically enterprises in which they have taken the responsibility inherent in an equity interest.
The argument for taking equity interests is nothing more or less than the old Socialist argument for nationalisation. It is the desire to own enterprises instead of merely assisting them for the public good. The fusing of these two interests has in the past led to failure, to the putting of political considerations, the avoidance of political embarrassments by the sacrifice of economic considerations, with the disastrous results which we see in so many nationalised industries.
Let us not broaden this but learn from sacrifice and let this sacrifice by the Government to their own Left-wing be quietly forgotten. It will have to be forgotten when we are returned to power, because I am certain that we will not risk public money in the taking of equity in that province which properly belongs to private enterprise.

Mr. John Peyton: The Amendment in the name of my hon. Friend the Member for Bury St. Edmunds (Mr. Eldon Griffiths) and myself was not intended as an expression of disagreement with the Amendment passed in another place, but merely to highlight the undesirable embarrassments which we believe would be attendant upon the Government holding equity shares accompanied by voting rights. Perhaps I may be allowed to say at the outset how nice it is for one who has been upstairs in that stuffy hermitage No. 10—the Committee Room, not No. 10 Downing Street, that would be even worse—to be down here having comparatively fresh air and plenty of room. The view of the empty benches opposite is one of the nicest one sees in Parliament.
The Amendment we are discussing is to limit the power of the so-called "competent authority" to provide financial support and in particular to provide


it by means of equity capital. "Competent authority" is defined in page 2 of the Bill as:
the Minister of Technology, a Secretary of State, the Board of Trade, the Minister of Public Building and Works, the Minister of Transport, the Minister of Power, the Minister of Agriculture, Fisheries and Food and the Minister of Health.
If one were to look at the past of any one of those right hon. Gentlemen one would find in their factual records abundant grounds for concluding that if they were authorities at all they were certainly not competent.

Mr. John Smith: Would my hon. Friend agree that we have here an extraordinary example of their incompetence? The Government Amendment has had to be starred because they did not even have the competence to get it down before that of my hon. Friend the Member for Yeovil (Mr. Peyton).

Mr. Peyton: I am very much obliged to my hon. Friend, and of course it is something to which we are very well accustomed by now. Even with all the machinery they have they still cannot achieve competence.

Mr. Edward M. Taylor: Is my hon. Friend seriously suggesting that in this Bill the Secretary of State for Scotland is defined as a competent authority?

Mr. Peyton: I quite understand that if my hon. Friend the Member for Cathcart had not read this Clause of the Bill, he would be well justified in suffering from a very severe shock. Equally, I believe he would conclude on reflection that it would be unfair if he were to blame me for so describing the Secretary of State for Scotland. Such a thing would not occur to me in my wildest, most irresponsible moments. I agree with the biting comment of the hon. Gentleman the Member for Bury St. Edmunds that we really have not heard enough—and indeed we have not heard anything—from the Minister as to the reasons for rejecting this very important Amendment that we have received from another place. I hope the Parliamentary Secretary will take a little notice of the arguments of the Opposition, otherwise they have to be repeated more frequently.
I am sorry that the right hon. Gentleman the Minister of Technology should obviously regard these objections as being arguments which have been made before and views which he does not accept and therefore arguments to which he is under no duty to listen. But I hope that the Parliamentary Secretary will be good enough to pass on to his right hon. Friend a note of the anxiety of Parliament, or at any rate of this side of the House, to know whether Parliamentary agreement to this Measure has been preempted. Have the Government already embarked upon a Measure for which they do not have the present authority? Perhaps the Parliamentary Secretary would rise to his feet now and tell me; or are we to conclude that the Government again stand in the dock convicted by their own silence, that they have embarked upon some commercial venture for which the consent of Parliament was necessary without first bothering to obtain that consent and that they knew they could steamroller this Measure through Parliament by means of their normally docile majority? Is the Parliamentary Secretary going to deny that?

Dr. Bray: If the hon. Gentleman wishes me to convey what he has said to my right hon. Friend I will certainly do so, and I am sure he will reply to the points the hon. Gentleman is making.

Mr. Peyton: I am very much obliged to the Parliamentary Secretary, but we on this side tried to flatter him with the impression that he has some responsibility for or knowledge of what happens in his Department. I have asked a plain question which we are told is to be passed to the Minister but which I should have thought any Parliamentary Secretary would have been able to answer. The Parliamentary Secretary has answered this eloquently by his silence. It appears that at this stage Parliament has once again been taken for granted. I very much agree with the prediction of my hon. Friend the Member for the Cities of London and Westminster (Mr. John Smith) when he foresees in this Measure the certainty of trouble and that there will be a series of awkward and quite un-covenanted predicaments into which the Government can get. I would also like respectfully to comment on what was said by my hon. Friend the Member for


Kidderminster (Sir T. Brinton) who accused the Government of a desire to own and control quite divorced from any considerations of public good.
It seems to me that any Government should regard themselves as the trustees of the taxpayers' money, and moreover trustees who are under a very much more onerous and high standard of duty than ordinary trustees. It is sad for our country that this is habitually forgotten by governments and very particularly by this one. I believe the Government are under a duty to take a very high standard of care; and the shocking negligence and carelessness with which this Government embarks on one ill-considered venture after another is not a good background for proposals such as this. That is the reason why we feel that the Government, as holders of equity shares, would be doing no service to themselves or to the taxpayers or to any company in the affairs of which they seek to embark. It may well be argued that British Petroleum is an example of how things can work out the other way. I believe that British Petroleum is an example of the exception which proves the rule.
The Minister of Technology shows his contempt for Parliamentary democracy and perhaps his Parliamentary Secretary could persuade his right hon. Friend to read these remarks in the OFFICIAL REPORT tomorrow. If he or any other Member of this wretched Administration has either the acumen or the good fortune to make the kind of investment which a British Government made in what is now British Petroleum in 1910 and in the years immediately following, we will be the first to congratulate them. But, as those two things are themselves unlikely and as it is even more unlikely that the right hon. Gentleman, if he did have either the acumen or the luck to make such an investment, would have the modesty to refrain from interfering, therefore, I say that British Petroleum is a complete exception.

Mr. John Smith: It has its troubles.

Mr. Peyton: By and large, it has been a brilliantly successful enterprise. If any British Government have the acumen or luck to make a similar investment I will be the first to congratulate them and rejoice with them.
6.0 p.m.
Various questions are bound to crop up and they will make for awkwardness at every stage. Who will control the company? I wonder if the Government are a good minority shareholder? Should any Government, who handle the taxpayers' money, be a minority shareholder? There is also the question of the relations between the Government and their co-shareholders—between the Government and the company itself. Few employees of any nationalised industry or Government Department would be enthusiastic advocates of the idea that the Government are the best possible employer.
What will happen in the event of a take-over bid? What sort of role will the Government play? They cannot pretend that they are not there, particularly since they have enormous influence. The Government cannot sell their shares because once it became known that they were selling, the market would become greatly depressed. And what about the other shareholders in the concern? On this basis the taxpayers' money is tied up for ever.
Even worse, it is virtually certain that the Government will be drawn into areas which offer no great promise. Opportunities are likely to come the Government's way, but they are also likely to be doubtful. It seems that once the Government decide to go into one of these ventures it will be difficult for them to pull out and say, "Enough is enough".
All Governments try to cover their failures, even if it means pouring good money after bad. I have been convinced that if I could persuade a Government Department to lend me £5 to dig a hole in the road for no disclosed purpose, I could, once I had obtained my money, go on and get millions of £s until a courageous Minister finally wrote the whole thing off as a ghastly failure. I am, therefore, worried at the possibility of the Government being drawn into one flabby commercial proposition after another and not having the guts to withdraw and say, "No more".
On commercial considerations, it would be difficult to find worse judges than Governments. In any event, do not the Government have enough to do? At


present they are woefully neglecting their responsibilities. Why they should now be so concerned with owning a few equity shares I do not know. They should drop this terrible habit of interfering in other people's affairs and get on with their job, which at present they are leaving to hazard.
I will not quote from the outburst of idiocy of the Minister of Technology last week. Some of it was arrogant even by his standards. Perhaps I should have informed the right hon. Gentleman that I intended to refer to him. He referred to the demand for greater political responsibility and power for the individual. What did he mean by that when, at the same time, he is embarking on proposals of this kind? I cannot guess what sort of play on words he was making. Now we are told that there will be a new popular democracy to replace the present Parliamentary democracy. The right hon. Gentleman is skilled at suggesting that the faults today lie at the door of Parliament and not, as is the fact, with the present Administration, who stand charged with heavy neglect of their duties and gross interference with the legitimate interests of the private citizen.
Before us today is another example of their neglect and interference. The nation and British industry have been done a service by their Lordships' House in calling attention to the danger of Government interference on this scale. I regret that the obedient, docile and complacent majority opposite—they have not even bothered to turn up to listen to this discussion—will shortly file obediently through the Lobby in support of a Minister who has not even bothered to listen to the arguments which my hon. Friends are deploying against him.
We are constantly getting insults thrown at the House. The nonchalance with which Ministers conduct their Parliamentary duties, under an Administration who are tottering towards ruin—I would not mind that if it were not the nation's ruin as well—is an affront which I hope the House will not tolerate.

Mr. Edward M. Taylor: It is always difficult to follow my hon. Friend the Member for Yeovil (Mr. Peyton), but it is even more difficult today because he dealt so clearly and comprehensively with the Amendment.
My hon. Friend the Member for Bury St. Edmunds (Mr. Eldon Griffiths) said that the arguments adduced in the House of Lords made mincemeat of the Government's proposal. To the man in the street, the Government's case might sound reasonable, for they are saying that if it is right for the individual and groups of individuals to make profit from industry and allow profits to come from industry, the Government, as the custodian of the people's money, should have an opportunity to share in the loot? That seems an argument of some merit, but when one examines it one sees that it is irresponsible and bad for the nation.
It is basically wrong to consider the Government and the individual in the same way. I believe in capitalism and that the natural disciplines of the capitalist system work to the advantage of the people generally. When we consider Government participation in equities, we can see how these natural disciplines will be interfered with. What happens when a company wishes to attract capital? It pays out dividends to ensure that, when it wants a rights issue, it can raise money in the market. To that extent they try to increase dividends so that it will be easier to attract capital.
If the Government have a 40 per cent. stage in the equity of that company there is no obligation on the company to pay out dividends to the extent that it should. Companies have a natural ability to hold on to money for investment purposes. The profitable and potentially profitable companies should attract capital, and the companies which do not have a rosy future will not. A major Government stake in a company will ensure that the company has access to unlimited sources of capital, and the Government will be interfering with one of the natural disciplines of the capitalist system which can lead to industrial expansion, which is the title of the Bill.
When I was rich, before I came to the House, I had the pleasure of being a shareholder in a small company. I had 50 shares with Associated Bakeries and General Investments. The investment amounted to £6. I was proud of it and, as I was a shareholder, I thought that I should take an active interest in the company's affairs, so I went to the annual general meeting. Only seven people were present, the meeting lasted for 10


minutes, and then we had a lunch which I felt was more than adequate dividend for the small stake I had in the company. The company was well and effectively run, and the shareholders left it entirely alone and allowed the management to get on with the business of running the company.
The distinction between ownership and control is dealt with in a book which was written by a man called Burnham who belongs to the opposite ideological camp. How can a Government with a major stake in equity, with our present political set-up, be a sleeping partner? B.P. has been mentioned by my hon. Friend as the exception which proves the rule, but let us see the situation that could arise. The Government wished to stop oil going to Rhodesia, but I was there in the summer and they were getting all the oil they wanted. The hon. Member for Liverpool, Walton (Mr. Heffer) late one night raised the matter of B.P. tankers carrying oil to Rhodesia and he said how shameful it was that ships in which the Government have a stake should be used for this purpose.
My hon. Friend on the Front Bench has been fighting for Short Bros., and they are very fortunate to have such a splendid advocate. Although it was not so with Short Bros, and Harlands, it could happen when the Government have a major stake, that orders may be directed to companies when they should not be directed. The natural disciplines of the capital system would be interfered with, which would be bad for the country.

Mr. Peyton: Since my hon. Friend has mentioned Short Bros., he might care to dwell upon the wretched relations which have existed between the Government and industry. Mr. Wrangham, the chairman of Shorts, was disgracefully treated, and so was Sir Reginald Verdon Smith, of Bristol Siddeley.

Mr. Taylor: It was a shameful case of interference.

Notice taken that 40 Members were not present;

House counted, and 40 Members being present—

6.15 p.m.

Mr. Edward M. Taylor: I am very grateful to my hon. Friend for getting me

an audience which, by my own efforts I could not get, although hon. Members are not staying very long.
A major Government shareholding can interfere with the natural discipline of the capitalist economy which works in the interests of the nation and of growth.
It is argued that a Government stake in equity is a good investment, in the sense that it takes care of inflation. There is a better way by which the Government can safeguard themselves against inflation, and that is by not getting so involved in industry and not eating up so much of the capital of industry by the legislation which they bring forward.
If the Government go ahead with their proposal to have a major stake in the equity of companies and also with nationalisation schemes, then inflation is inevitable. Inflation is caused by Government spending, Government investment, and by the way in which the Government allocate scarce resources of capital.
My hon. Friend the Member for Yeovil was right to say that the Government are the custodians of the public purse and that they should be more careful with it than we are with our own money. If they are involved with major equity shareholdings, this will not be possible. Equity shares are never the first charge on the assets of a company, but debentures and preference shares exist. If the company got into difficulties then the Government's investment, that is to say the people's investment, could disappear overnight.
If the Lords Amendment is rejected, and the Government go ahead with their plans to buy equities, can they say where the new capital will come from? A factor which is preventing industrial expansion is the increasing share of the national cake which is being eaten up by the Government in the way that they are allocating capital and spending their money. It is a sad reflection on the Government that in three short years the burden on the average family in taxation has increased by £3 a week. This is caused by the Government spending money as they propose to do in the Bill and in other directions. We should, therefore, support the Lords in their Amendment.
The Government are obsessed by ideology. This is not an isolated case. Only a few hours ago we were considering the


Transport Bill which involved the spending of £1,900 million of public money. The Bill provides for unlimited activity by the State—

Mr. Speaker: That debate is over.

Mr. Taylor: Mr. Speaker, I am sorry in some ways that it is, because we had many important matters with which it was not possible to deal.
In this very important Amendment, we see yet another example of the Government's obsession with ideology. My hon. Friend the Member for Bury St. Edmunds (Mr. Eldon Griffiths) said that there was a possibility that the Government had gone ahead with these powers before the legislation was passed. The suspicion grew when my hon. Friend the Member for Yeovil tried to intervene in the Parliamentary Secretary's speech and failed to do so.
It was suggested that a major European computer company was being considered and might be one of the first to be set up under the legislation. I wonder whether there is any truth in that? I have a suspicion that the Government are considering something of the sort. They are becoming obsessed with the possibilities of the Common Market, and recently we have had the introduction of such factors as decimal currency, Summer time—

Mr. Speaker: Order. These obsessions have nothing to do with the Amendment.

Mr. Taylor: I apologise, Mr. Speaker.
I would ask the Government seriously to consider whether this is the sort of investment for the people when it is not a first charge on the assets of the companies involved. There is a danger that, once an equity stock is taken, the Government will have a stake in the survival of that company, whether it is profitable or not. Having spent £5 million, say, for an equity stake, politically and economically they have a vested interest in the success of the company, come what may. It might be in its normal commercial interests to close down, but the danger is that, once £5 million of public money has gone into it, another £5 million will be added.
This is not in the national interest. It is a bad move. The House of Lords was

quite right in its Amendment, and I hope that the Government will consider it. It may be good for the Government to consider it seriously, because it is probably the first of many more Amendments from the other place. Bearing in mind future Amendments on more significant Measures, it would be good training for the Government if they accepted this one and showed their good will in that way.

Sir Brandon Rhys Williams: Much of our debate on Second Reading and in Committee took place before I had the good fortune to be able to take part. But I have studied the reports in detail, and I have studied the reasons why their Lordships decided to make this important Amendment. I hope that I will have the indulgence of the House in putting forward one or two comments.
Nearly all of the remarks made about this proposal have been studying the Measure from the taxpayer's viewpoint. However, the object of the Bill is to promote efficiency. After all, its name is the Industrial Expansion Bill, and I think that it would be fruitful to consider the effect that it will have on management performance and management attitudes if it becomes an Act.
If the Bill is simply a Measure to provide subsidies, it stands well enough as it is. If it is intended to provide the Government with a measure of control, with a view to changing the policy or direction of the firms concerned, the Amendment becomes pivotal. In my own observation, the principal cause of inefficiency in limited liability companies is the virtual abdication of the shareholders. Meetings are nearly always unattended. If shareholders go, it is rare that they have an opportunity of raising a question which is likely to change the direction of the management's thinking.
The institutions are said to be in a position to exercise shareholders' power, and no doubt they would be if they had the resources to study the inner problems of management in all the many hundreds of companies in which they have interests. However, our big financial institutions are in competition with each other and cannot afford to take on large staffs of qualified people who would be able to look with an informed eye at what is going on in the companies in


which they have shares. If an institution begins to doubt whether a firm is taking the right direction or its management is competent, usually it opts out, sells its holding and does not attempt to intervene.
The Press is an element in the discipline of management, and it has been growing in the last year or 18 months. However, when one knows the innermost secrets of a company and then reads what the Press says about it, all too often it is clear that newspaper correspondents are unable to extract the information that they need in order fully to explain a latent inefficiency or wrong decisions.
Quite an element of discipline is exercised by a take-over bidder; but he is an executioner rather than a doctor. By the time that a take-over bid has reached the stage where it is likely to succeed, it is far too late for the management to put its house in order. Some way must be found for making the equity shareholder more effective, and, after living with the problem of managerial efficiency for several years, I am convinced that this is an area in which the Government must act. But it is wrong to dilute the equity shareholding by introducing a new type of shareholder whose interests are not the same as those of the others. That is a wrong approach and will not succeed.
If I may give the Government a hint, should they want to follow up the idea of introducing greater efficiency into industry and business by legislation they should see what can be done by introducing the concept of the management audit rather than by diluting the equity shareholding. Looking at the matter from the viewpoint of the management, it is clear that either the Government intend to exercise their rights as a shareholder, or they do not. If they do not, the taxpayer will be in a position of taking risks without responsibilities— what might be called the prerogative of the non-voting shareholder throughout all crises.
If they do decide to exercise authority, they will be introducing a new element into the running of companies. Managements will have to bear in mind that a large or small element in the equity holding is in the hands of people whose minds lean towards political or social considerations and that these are

paramount for the Government shareholders, although they are only of secondary importance to the rest. We shall see in the boardrooms of companies that have accepted help by way of an equity shareholding—or had it forced upon them—signs of schizophrenia, because they will not know who they are supposed to serve.
While I sympathise with the Government's object, the Bill has all the appearance of having been drafted by people who have learned about industry out of books. Unfortunately, that is all too often the case with the Government's industrial measures. If they would draw on the advice of people who have practical experience of the real problems affecting the management of industry and business, they would not add to the problems which are distracting managements by refusing to accept this Amendment.

Mr. David Lane: In opposing the Government's proposition, I hope to keep my comments brief, but I cannot be as brief as the Minister was in making his very casual speech.
I am glad that we have this chance of a further debate for a few minutes on the Bill, because it seems to me that the position in which we find ourselves today is topical. Tribute has been paid to the work done on the Bill in another place. Having taken part in the proceedings in Standing Committee, I know how keen has been the scrutiny that their Lordships have given to the Bill. I hope that they will be able to give a similar critical judgment to other Measures which may be reaching them in the near future, notably, the Transport Bill and the Prices and Incomes Bill.
I am glad that their Lordships have made this improvement to Clause 2, and, despite the Government's advice, I hope that this House will agree with the other place.
Many arguments have been put for-ward, and I stress only two matters, the first of them political and the other financial. There has been and still is a widespread public fear of back-door nationalisation. The Government make light of it. The matter arose several times in Committee. I ask the Government to take this much more seriously as a matter of very great psychological importance in


the country today. It is largely their own fault that this has arisen because of the many statements from the party opposite about nationalisation.
6.30 p.m.
For years we have had this theme of extension of public ownership. If they allege that we start with a strong prejudice against it, it is fair to say that they show a very strong prejudice for it and they show no sign of losing that prejudice. We had the era of wholesale nationalisation Measures just after the war, and more recently the Prime Minister in particular has been talking of other forms of public control and public ownership. Month after month on the Order Paper we are reminded of the predilection for public ownership by various Motions which are put forward by hon. Members opposite. The most recent case in legislation, apart from this Bill, was the Steel Nationalisation Bill, which was carried through against all the merits.

Mr. Speaker: Order. On some other occasion we may have a discussion on steel nationalisation, but not on this Amendment.

Mr. Lane: I beg your pardon, Mr. Speaker. I was about to make no more than a passing reference to it and also to say that if only the right hon. Gentleman's rather heady idea of a referendum had been in force that Bill would never have reached the Statute Book.
This is the background against which we have to judge the assurances we have had from the right hon. Gentleman and his colleagues that this Bill is in no sense a form of back-door nationalisation. The difficulty is that on all these questions we hear so many voices from the Government. There have been the Prime Minister, the Chancellor of the Exchequer, the Secretary of State for Economic Affairs—

Mr. Speaker: Order. The hon. Member must link his speech with the Amendment, which argues that financial support should not include equity capital.

Mr. Lane: I am sorry that I did not make clear that the considerations I have mentioned are the reason for the great public uneasiness about this particular feature of this Bill and other similar features of other Bills.

Mr. Speaker: Order. It is the feature of this Bill we are talking about, not other features of other Bills.

Mr. Lane: I am sorry again. I ask that the House should agree with their Lordships in excluding equity shareholdings from the provisions of Clause 2 of the Bill. If we did that we should do something to allay the widespread uneasiness I have been talking about.
The other point is the financial one about the form of support that should be given to schemes provided for in the Bill. The type of scheme envisaged in the words of Clause 2 is one which
would not be undertaken without such financial support as is authorised by this section.
For these schemes from the financial viewpoint loans are a much preferable form of support. Loans would provide a sure return to the public funds at what may be a tricky time in the history of a venture. It is much fairer and more safe for the taxpayer who has seen too much money go down the drain in unwise ventures. There is a certain interest to come back throughout the term of the loan. This is a much better form of investment in these circumstances than an equity holding. It is easier to get the advance back and to keep public money circulating in desirable ventures.
The Government may argue that when the public are taking a risk they should get their reward, but loans are much more satisfactory in the narrow context in which we are discussing the Bill. Anyway, the Government automatically get 42½ per cent. of all profits on all ventures. I remind the Government of what they are always saying about the need for partnership with industry. This is the psychological reason for agreeing with their Lordships in this Amendment. Today, that partnership falls far short of what it ought to be, but this Amendment would go some way towards putting that right.
That the Bill is being proceeded with at all is a sign of the rather topsy-turvy priorities we have had from the Government. I am glad to see my hon. Friend the Member for Warwick and Leamington (Mr. Dudley Smith) in his place, because I think that it was in that by-election that the right hon. Gentleman spoke of the pledges the Government


were giving us. One very relevant pledge was:
The Government will, if necessary, hold back things which are less essential.
It is a thousand pities that they did not apply that excellent principle to this Bill. It remains a bad Bill, but it would be slightly less bad if the House agreed with their Lordships in this Amendment.

Mr. Higgins: The Financial Times, on 1st November last year, had an article headed, "How the Government may act". The article began:
Of all the proposed legislation which was contained in the Queen's Speech yesterday, the most controversial is almost certainly the Industrial Expansion Bill.
When we began to debate the matter this afternoon, I could not help feeling that there was some danger that what had been heralded as a controversial matter might be in danger of going out not with a bang, but with a whimper. However, I had not reckoned with the very powerful speeches which have been made by my hon. Friends.
The principle enshrined in this Amendment strikes at the very root of the basic difference between the two sides of the House. I think that even the Minister would agree with that. We on this side of the House are concerned that the Bill should be amended in this way, because it tends to extend the principle of public ownership. We are convinced that it is through private enterprise and not through Government intervention, that we are likely to get a better rate of progress in the economy.
At least one thing can be said for the Bill. Unlike the other controversial Measures which have over-shadowed the industrial scene, such as prices and incomes and the Finance Bill, it was considered in great detail in Committee. Therefore, it is right that we should return to it this evening. I disagree with the Minister, who, in his opening speech, which by any standard must have been regarded as inadequate—indeed, almost perfunctory—that the point made in this debate was covered in any great detail.
As my hon. Friend the Member for Eastleigh (Mr. David Price) pointed out, we debated it in rather broader terms, but not on the specific narrow issue, although we would not dispute that the narrow

issue of equity raises a point of principle almost identical with the point of principle we debated on Second Reading.
The Minister, throughout our earlier debates, was anxious to play down the fact that this is an extension of public ownership. His justification for the Bill was expressed almost entirely in terms of various considerations which were set out in Clause 2(a) to (f), the various cases for making loans to encourage efficiency, and so on. The extension of public ownership was something which he wished to minimise. Perhaps that was why we had such an inadequate explanation of the reasons why he thought the House should reject the Amendment their Lordships had made and which we feel ought to be supported.
There is a very great division of opinion between the two sides of the House because our view is that it is not the function of the Government to engage in undertakings which are essentially risk-bearing undertakings and to invest money in them. A number of hon. Members who have spoken, my hon. Friend the Member for Bury St. Edmunds (Mr. Eldon Griffiths), for example, have pointed out that if an enterprise is profitable the Government take about 45 per cent. in Corporation Tax and other taxes. He did not point out that if the Government engage in an enterprise which may not turn out to be profitable they make a loss on both accounts. In addition to the, loss of tax revenue there is the possible loss of the assets which turn out not to be profitable.
If the Government propose to take an equity interest in a firm or group of firms it is reasonable that the House should be given a real prospectus on investment in that industry. It is really in the position of a shareholder being asked to invest in a company. One could say that the House should have a capital proposal worked out in detail justifying the equity investment. But under the present arrangement, while the House will in some cases get more information than it has had on previous occasions, that information is still not comparable to that which one would expect in private industry. It is certainly not comparable with that which the directors of a firm would expect to get, and, therefore, is not a firm basis for deciding to invest in a company. This being so, it may well be that the


Government, in taking the equity interest, impose a further charge on the taxpayer. That brings me to the second point which we should consider, which was not debated when the matter was discussed before. If the Government are to take an equity interest in a firm or industry, what criteria will they use for an acceptable rate of return? We debated in Committee specific projects such as the Beagle aircraft project and the Concorde, but we never had a clear answer from the Minister on what rate of return he thought was reasonable, although we established that in many of these projects there is not likley to be any rate of return for a number of years.

Mr. Benn: Even passing the Amendment which we are now considering would not affect the Concorde or Beagle, because the Amendment relates to the industrial investment schemes and those projects are dealt with by separate Clauses. I hope that the hon. Gentleman is not in any doubt on that.

Mr. Higgins: I am in no doubt at all about that, but I was concerned that projects should be appraised on a consistent basis. We have had no clear indication of what the Minister regards as an acceptable rate of return if we are to take an equity interest under the Bill, and I was commenting in passing that it looked as though on some of the projects he did not even expect a positive rate of return for a number of years.
When we considered the National Loans Act there was considerable discussion on what the rate of return should be if a nationalised industry made an investment in a particular field. It seems that the nationalised industries are being asked to have an 8 per cent. rate of return. It is not unreasonable to ask the Minister what rate of return he thinks would justify an equity investment by the Government. We have had no clear answer.
In the Committee on the National Loans Act I quoted from the White Paper on investment in the nationalised industries—a Review of Economic and Financial Objectives—when referring to the question of the discount rate and the test rate of return. The White Paper said:
Equally, it does not follow that all investments passing the test rate"—

that is, the 8 per cent. rate—
are automatically undertaken. The test rate of discount is essentially a device to ensure that the calls of the public and private sectors upon resources do not get out of line with each other over the long term.
One of the things we are concerned about in considering whether the Government should take an equity interest beyond the nationalised industries, extending the scope of public ownership, is whether or not that equity investment is likely to be even consistent with the meagre rates of return which the Government expect to get from the nationalised industries.

6.45 p.m.

Mr. John Biggs-Davison: And have not obtained.

Mr. Higgins: And which, in many cases, as my hon. Friend rightly points out, they have not obtained. This is a serious point that is very relevant to their Lordships' Amendment, and we should have a reply from the Government tonight.
A number of my hon. Friends have put forward powerful arguments on the question of whether the Government should have control if they take an equity interest in an undertaking. It is the general consensus on this side of the House that whether or not they have control there are still objections in principle against their investing in the way in which they would be able to invest if the Amendment is not approved by the House.
The criterion should be what the profitability is or is not. We were told in an earlier speech on the subject that companies would not be forced to have the Government taking an equity interest. This is not surprising. It may well be that an unprofitable company or one which is very risky will not feel that it should object unduly to the Government's giving it money or even taking an equity interest. We feel that that is not likely to result in the right use of the country's resources, that a Welfare State for industry, or subsidies of this kind, are not likely to be in the long-term interests of the country or of the taxpayers, who are likely to have a considerable burden placed on them here.

Mr. Eldon Griffiths: Is not the danger that the Government will invest in the


bad apples whereas the good apples do not need them?

Mr. Higgins: I entirely agree with my hon. Friend. This may well be the case, and if nationalisation in general is anything to go by it will almost certainly be the case. We need to know what the projects are and to have further information on the subject.
It would be common ground throughout the House that the overall level of investment in the country is too low to create the rate of economic growth we should like to see. This has been brought about by the policies the Government have pursued over the last few years, resulting in a great deal of competition for capital by industry.
If the Government are enabled under the Bill to take an equity interest in this or that project which they believe is right, rather than using the forces of the market to allocate resources to those projects which are most profitable and therefore most likely to reflect the consumers' demands for their products, we are likely to find ourselves in a position where the Government's chosen companies and projects, assessed on a basis about which we are not entirely clear, are given priority over others.
When a sudden credit squeeze is being imposed by the Chancellor of the Exchequer, working through the financial institutions, when rates of interest are exceptionally high, when devaluation is likely to have an adverse effect, and when dividend restraint is making it more difficult for firms to attract capital, this is something of which the House should not approve at the present time, even if it were not wrong in principle.

Mr. Stanley R. McMaster: Is not there another danger which my hon. Friend has ommitted to mention, that once Government money is invested in a business such as the air corporations the Government are in a position to restrict competition, such as over the question of licensing the independents? Thus, we get less competition and less effcient service for the consumer, as well as a stultifying of the growth of the independents, which is bad for the country as a whole. Is not this an aspect which we should also consider?

Mr. Higgins: This is a very important point. As my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor) pointed out, one of the implications of the Government's saying that they will finance a particular firm is that they may not be all that anxious that the degree of competition which the firm faces shall be as high as it might otherwise be. I would dearly like to digress on the question of the I.A.T.A. and the lack of competition in air fares, but I suspect, Mr. Speaker, that I should be straining your kindness if I were to do so.
But a point which is in order is again one raised by my hon. Friend the Member for Cathcart, when he said that the great advantage of working through the ordinary mechanics of the market is that a firm which is really efficient, profitable and is meeting consumer demand, makes high profits and can pay high dividends —except for the Government's policy of restraint—and, therefore, is able to attract capital. These are the firms we should encourage rather than the sort of firms which the Government feel for one reason or another are likely to be in the public interest.
We have grave doubts of the Government's ability to select these projects or criteria. We do not believe that they are likely to work out in the public interest. The Government are proposing to take an equity interest in particular projects at a cost to the taxpayer of between £100 million and £150 million. We do not believe that the Bill is likely to further the interests of the country in our present economic situation. We feel that the Amendment is likely to remove at any rate some of the disadvantages of the Bill, and I hope that my right hon. and hon. Friends will support it in the Lobby.

Mr. Benn: Mr. Benn rose—

Mr. Dudley Smith: On a point of order, Mr. Speaker. I see the Minister of Technology rising to speak. May I ask you whether he is permitted to speak for the second time in a debate of this kind? He has absented himself arbitrarily and arrogantly for long periods and I cannot see how he can possibly know what has been said and make a proper reply.

Mr. Speaker: I will deal with the point of order in that submission. The rest is a matter of comment. The right hon.


Gentleman has the right to speak a second time, but he must have leave of the House.

Mr. Benn: I was about to ask leave of the House to reply, Mr. Speaker.
I apologise for having left the Chamber during the course of the debate for a total of about half an hour, but I have had brought to my attention the points made during my absence and I hope that the House will acquit me of discourtesy in introducing the debate so briefly. I thought that it would be better to be brief in opening and to deal at the end with the points raised in the debate, thus saving two long speeches from myself.
The House debated the Bill fully when it was before it, including identical Amendments. We had an extremely good Committee stage upstairs and good debates on Second Reading, Report stage and Third Reading on the Floor of the House. The House then sent the Bill to another place in a certain form and the case for changing the Bill needed to be made by those who believe that change was required. I thought that the proper thing to do was to indicate that the Government thought that the Bill was in the right form as it left the House and then listen to those who support the Lords Amendment.
What struck me about the speeches in the debate is how very few hon. Members opposite spoke of this from the point of view of industry and of the problems that it has to face in meeting overseas competition. The dream world pictured for us by the hon. Member for Worthing (Mr. Higgins), of market forces shaping these things, is not the real world. Any one who suposes that the American taxpayer does not intervene powerfully to reinforce American advanced industries has no idea of what is happening.
Of course, the Americans are so rich that they do it by means of enormous procurement programmes, which finance research, design, development and early production targets of American products, and then American businessmen, having had all their learning costs paid for them, venture abroad and confront British industries which have not had the advantage of this degree of public procurement.
The hon. Member for Worthing is infinitely more knowledgeable than I

about the ways of the City and the financing of industry. If he is addressing himself to the problems of making British industry competitive, which is the objective of this exercise, he should take some account of the fact that we are confronting other large industrial corporations abroad which simply exist upon large contracts from foreign Governments. This is the problem.

Mr. Eldon Griffiths: Mr. Eldon Griffiths indicated dissent.

Mr. Benn: Of course they do; and this is the problem. Does the hon. Gentleman think that I.B.M. would be in its present position without the space programme, or that the micro-electronics industry would be in the position it is without American defence spending? Of course this is the problem. We are considering what is the appropriate form by which the Government can work with industry in order to see that our industrial competitiveness is improved without direct or indirect subsidy.
The work of my Department is really more closely connected with industrial problems than it is with the application of technology as such in industry. Let us look, for example, at the work in the shipbuilding, computer, motor, aeroengine, nuclear power, machine tool and micro-electronics industries. Almost all the work of my Department has been in this area, which the Lords Amendment touches on. It is that of industrial structure and how and in what form and by what rules and under what conditions the Government should be in a position to provide assistance.
The debate would have been more helpful to me and others who will read HANSARD if hon. Members opposite had tried to look at this matter from the point of view that they would have to look at it were they occupying our positions. Yet we heard market forces spoken of in the same breath as the aircraft industry when there is no one here in his senses who believes that the British aircraft industry or any aircraft industry could' survive five minutes on the basis of market forces.
Are hon. Members opposite really saying that launching aid, research and development contracts and the spin-off of military spending have no relevance? The


hon. Member for Belfast, East (Mr. McMaster) might have mentioned Short Bros, and Harland. Does he claim that one can separate Government and industry one from another in the age in which we live?

Mr. Speaker: Order. With respect, we must come to the Amendment, which concerns whether we should exclude equity capital.

Mr. Bean: I am grateful to you for being so patient, Mr. Speaker, because this is the background to the Amendment. If there is a need—and no one in the House would deny it—for very substantial Government expenditure in industry, then is it right to exclude for all time and in alt circumstances any possibility of this being done by equity holdings?
We did the same sort of thing in the Shipbuilding Industry Act. It contained identical provisions to those in this Bill. When I took over the piloting of that Act through the House, I urged that we should include equity capital as one of the proper tools to have in the tool bag when approaching the shipbuilding industry. It has not been used. I did not think that would be used often in that case, for some of the reasons given by hon. Members. Why should we use equity if there is a more appropriate way of achieving the objective'? It happens that there has been one change in Government policy in the shipbuilding industry. It has, in a sense, been in the opposite direction. Whereas the Fairfield yard was mainly a Government-owned yard, it is now a 17 per cent. holding in the Upper Clyde Group, which is principally privately owned.
For the Opposition to get out the dogs of war and ask them to bay or bray weakly as though there were a great principle dividing the parties on this matter does not bear examination. It sounds grand, on the eve of the Queen's Speech, to produce the drums and sound them, but after a year's detailed debate on the problems of Government-industrial relationships and whether equity should be one of the facilities available, to produce a trumpet and give it a toot now is not convincing.

7.0 p.m.

Mr. Eldon Griffiths: Is not the Amendment concerned with the purchase of

equities? The right hon. Gentleman has referred to the United States. We recognise that market forces are not and can not, be of use in the micro-industry. Can he give one example of an American firm in which the Federal Government have purchased equities?

Mr. Benn: No, but I could give a lot of examples where the party opposite—

Mr. Eldon Griffiths: The right hon. Gentleman was talking about America.

Mr. Benn: No, the hon. Gentleman has missed the point vis-a-vis the United States. The point is that the Americans are aided by a procurement programme of gargantuan scale. It is a degree of support for industry which we cannot emulate. If we are trying to do it in a more cost-effective way, but on a much smaller scale by the injection of support at key points, this is quite different.
We are doing it in this instance by equity. Is it right to exclude this as one of the tools in the tool kit, if it is agreeable and there is no compulsory power? Is it wrong, if it is agreeable to the firm and the Government, which it would not always be, and if it is agreeable to the House, that each case will have to be brought under Affirmative Order? Can there be anything wrong with that?

Mr. McMaster: The reason I did not mention Short Bros, was because I did not intervene in the debate. To take the example of Short's, would the Minister not agree that while it may be desirable for the Government to take an equity interest in the shares of a company to enable it to meet foreign competition, it is only a temporary measure? It should be made clear that Government policy is that once the special conditions have passed and the firm is on its feet and able to compete, the Government would relinquish their holding as quickly as possible, and leave it to private enterprise to get on with running the company?

Mr. Benn: I do not know whether the hon. Gentleman is suggesting that I should seek to sell Short's.

Mr. McMaster: Yes.

Mr. Benn: Perhaps the hon. Member would rise to his feet and confirm this.

Mr. McMaster: Now that Short's have become well established, would it not be wise to reduce, and finally completely relinquish, the Government's shareholding in a company such as this?

Mr. Benn: If this is the burning issue dividing the parties, the ultimate litmus paper, why was it not sold by the party opposite during its 13 years of office? I am not trying to make a party point here. This is not the critical issue between the parties in this area. As I made clear in Committee, the object of the Industrial Expansion Bill is not to get equities. If we want to take over a company the proper thing to do is to bring forward a Bill, make the case and argue it out, and then take it over. One of the reasons why hon. Members opopsite have muffed so many opportunities in this debate is that they believe that this is the motivation.

Mr. Dudley Smith: The right hon. Gentleman should listen to the debates.

Mr. Benn: I have listened to all the debates on this. "Back-door nationalisation" is one of the oldest phrases there is, and it came up at every stage in Committee. If the party opposite thinks that the object of this change is to increase public sector ownership, it has missed the opportunity to have some extremely interesting debates on the relationship between Government and industry. The Bill seeks to make a partnership with industry, designed to see that the country is competitive with its foreign competitors.
The hon. Gentleman said that the Bill had been hailed as controversial. Not by me. It was the Leader of his own party who demanded the withdrawal of the Bill. The great controversy was from the other side of the House. In the event, and I said this at many stages during the passage of the Bill, it will not be controversial in practice. It cannot be, because there are no compulsory powers, direct or indirect contained within the Bill. What we are trying to do, and this is something we debated in an atmosphere of considerable good will —I learned a lot—is to work out the ground rules under which Government and industry, using equity, if it is right, can work together as a partnership.

Mr. Higgins: What the right hon. Gentleman is doing is bringing in matters

which are not directly relevant to the Amendment in order to justify his case. There is a fundamental difference between the two sides on whether the Government should or should not take equities. If this back-door nationalisation is a by-product of the Bill, we are still opposed to that.

Mr. Benn: This is not so, in this sense, for this purpose, for this Bill. Quite apart from the cases where the party opposite has taken equity in companies, we have the first case coming up, if the Bill passes the House and gets the Royal Assent. We will have the opportunity of knowing then whether the House wants to reject this first proposal—the International Computers proposal—in which equity is a feature, as agreed between the parties, and subject to the approval of the House.
I shall await with the keenest interest the opportunity to test the hon. Gentleman's political judgment, and to know whether the party opposite will vote against the International Computers Order when it comes before the House. If this Bill gets through, when this comes before the House we shall see what divides the parties. We have heard that the hon. Gentleman will be voting against the Order.
There is a large element of hypocrisy in what is said about the relationship between the Government and industry and about equities. There are a number of firms operating in areas where some sort of Government help is required. On one day the heads of these firms are very happy to discuss this with us. This is not financing of lame ducks or white elephants, but the serious advanced technological projects which are facing competition from abroad, possibly through foreign procurement. These people come to discuss with us and it is obvious that public money will be required through equities, or in some other way. The computer arrangement has this feature. This is not only non-controversial, but is accepted as being one of the possibilities that ought to be discussed.
This has gone on while there have been "noises off" from those who say that this is fundamentally wrong and that the Government ought to keep out of industry. Sometimes the very people saying this are those with whom we have been dealing. I would like to say to


industrialists, and those who engage in the double game of recognising the reality of the need for partnership and then make speeches denouncing the partnership that they have proposed, that this is something which does not reflect great credit on them and does not damage us. The Government are interested only in the industrial success of the project.

Sir T. Brinton: Will the right hon. Gentleman tell us whether, having obtained this power to take equities, he will undertake never to use pressure to obtain equities in a company that is unwilling to give them? It is obviously possible for a company which badly requires cash finance to be faced by the Minister with the demand that this finance should be in the form of equities rather than anything else. What is his attitude?

Mr. Benn: If the hon. Gentleman is asking me to give an assurance that where public money is concerned I shall always be guided by the views of the directors of the company with which I am dealing, then it will not be possible to give such an assurance.

Sir T. Brinton: In other words, the right hon. Gentleman would use pressure.

Mr. Benn: I do not quite know what sort of pressure it is if one says to someone, "This would be interesting. Does it interest you?" If they say, "No", and one then goes away, that is not a very formidable pressure. No minister can give an undertaking that he would always give money to companies in the amounts they wanted without any consideration of the proper interests involved. It was an unhelpful intervention.
One question asked was whether we had anticipated legislation by the computer arrangement. I say "arrangement". It is, in fact, a draft agreement, subject to the consent of the House if this Bill gets the Royal Assent. I can give an assurance that, although the planning has been based upon the assumption and belief that the House will pass the Bill and, therefore, will be able to look at the Order, no Minister could give a commitment until the Order has come forward and received the assent of the House.
If hon. Members will reflect on what would happen if the Lords' Amendments

were carried, the computer deal would collapse in a way that would do grave damage to that particular project. Further legislation would be required. This legislation would come before the House and occupy a lot of time when we are told there is a congestion of legislation. It would merely duplicate the ground rules, in relation to computers, that are provided for in the Bill. If hon. Members opposite are really urging me to say that aid for industry is to be so rare an episode that each should be looked at legislatively as a separate Bill, they are asking for something which is not very sensible.
Relations between Government and industry are getting closer. This is why I think the Bill has merit. The Bill gives the House the opportunity to debate at length the ground rules which ought to operate, including a discussion about the circumstances under which equity is appropriate. After that every Order has to come forward and the House can say, "Yes, we accept it in this case. No, we do not accept it in the other."
This equity provision does not enable me to take equity in any company. Every case will come before the House and all the questions about discounted cash flow and so on, will be debated. I can promise—and this applies to all the projects I bring forward—that the information which will be made available to the House on the International Computers Order, subject to the Bill being enacted in its present form, will contain the fullest details ever given to Parliament by any Government of any involvement of public money in an industrial project.
I have written to the hon. Member for Eastleigh (Mr. David Price), who leads for the Opposition on this matter—he will not have received the letter yet, because I have not signed it—informing him of my intention to discuss ways and means by which we can see that this information is made available. I have done this because he and I agreed in Committee that it was important that it should be done. The House will have an opportunity of a kind that it has never had in the past to discuss in detail, with all the information that in this case will be available to shareholders and to others involved, whether it wants equity to be a part of the computer company which has been set up.

Sir Harry Legge-Bourke: Has the right hon. Gentleman considered the possibility, when he lays a scheme before the House and it comes to the question of an Order, of making two Orders where equity is involved?

Mr. Benn: It is no use the hon. Gentleman asking me at this stage, because we have discussed the ground rules on the Bill. I could not, even if I agreed to, introduce such an Amendment.
One of the main objects of the Bill was to see that Parliament considered at length and at leisure how money should be injected into industry and in what form and, in addition, should have an opportunity of considering whether in every case it was satisfied that that was done. Hundreds of millions of pounds have been put into the aircraft industry by successive Governments without ever coming to Parliament. There was no authorisation for launching aid procedures or for the enormous expenditure that went into that industry. In this non-aero-space, non-nuclear sphere of engineering, in which the Government think they will be required to operate, we are bringing forward a procedure which gives the House a right, which it has never had before, to look at these things carefully. This is an improvement in parliamentary control, as well as being a development of the partnership between Government and industry.
The hon. Member for the Cities of London and Westminster (Mr. John Smith), bringing considerable knowledge to the subject, raised a number of points for the information of the House. Some I have tried to deal with, but there are two I wish to deal with specifically. He said that equity was not always the most profitable way of investing money. Of course, he is right. In deciding whether to take an equity holding the Government will have to have regard, first, to the success of the project it wishes to sponsor and, secondly, to the consideration of getting the best value for the shareholders' money.
One of the reasons why we have not made use of the powers relating to the Shipbuilding Industry Board, which are identical to the ones we are discussing now, is that in no case brought forward by the Shipbuilding Industry Board has equity been the most appropriate means by which this money should be made avail-

able. It is not the object of the exercise to get equity. But, if it is right to go for equity and it is agreed by the company, I see no reason why the noble Lords should amend the Bill to deny to this House, the firms and the Government, the right to include equity as a discussable possibility between a firm and the Government Department.
7.15 p.m.
The hon. Member for the Cities of London and Westminster also raised the question of the undesirability of having Government directors. I wonder whether he has not misunderstood the arrangements under which Government directors are appointed.

Mr. John Smith: The right hon. Gentleman was not present when I spoke. I did not mention Government directors.

Mr. Benn: I understood that the hon. Gentleman had raised a number of points, one of which was that this would be undesirable. It was raised by one hon. Member. I apologise if it was not the hon. Member for the Cities of London and Westminster.
Our dealings with companies, whether there is a Government director or not, are linked through the chairmen. It is right that, even though there may be a Government director, we should deal with the chairman in each case. The role of the Government director, under existing companies law, is to represent the interests of the Government. That is why the industrial investment scheme has been brought forward.
The hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor) raised the question of political pressures. All Governments are subject to political pressures. But I assure the hon. Gentleman that political pressures are not limited to companies in which the Government have a shareholding. As the House knows, British industry—particularly engineering—is going through a serious period of rationalisation. The Table Office—I make no complaint about this; this is one of the conventions of the constitution which has developed— will more or less accept, and I accept, Questions about what happens in industry whether we have a shareholding or not.
All Governments today, in a world where industry interacts on Government,


are bound to be subject to political pressures, whether a firm is privately owned, publicly owned, or is a private company with some public holding. Any fear or hope the hon. Gentleman might have that one could in some way avoid political pressure by not having any public shareholding is mistaken. He really should exchange jobs to see what political pressures come from people who are anxious about their jobs, even where they work in firms in which the Government have no interest at all.
Finally, I would say a word or two to the hon. Member for Cambridge (Mr. Lane), who contributed a great deal to our debates in Committee. He again raised the great question of public enterprise and nationalisation. I have said before, and perhaps I may say it again to put the record straight, that the concept of public enterprise as it is being used by my Department—except for Short's or Beagle; I am not a holder of shares in a large way—is not confined to the idea that we should, in certain circumstances, as we have with steel and will do in other areas, nationalise an industry. The concept of public enterprise which we have brought forward is that the Government should be able to create agencies in which, with the help of public money, enterprising things can be done.
The first of these goes back to the N.R.D.C., in 1948, in which the Government gave money to a group of public corporations manned by people with industrial experience and said, "Will you operate in this field?". Much of what was said about the Industrial Expansion Bill and the dangers of equity holding was said at the time the N.R.D.C. was set up, but that Corporation is now as respectable as the W.V.S. In the old days it was the monster created by a Labour Government to seize control of industry. If one reads the speeches made then, one sees that some extraordinary bogeys were produced.
Since then we have had the I.R.C., and all the debates about whether it was concerned principally to extend public ownership. As I said on Second Reading—and we have tried to get it across on many occasions—its purpose is to rotate public holdings through the public sector to leave industry modernised and

stronger, and to use equity if it is appropriate to do so. Now we have the Shipbuilding Industry Board, which is the use of public enterprise rotating through the shipbuilding industry to leave it more efficient, but not with the object of getting a majority holding.
We have similar proposals under the Industrial Expansion Bill. This is a form of entrepreneurial activity by public agencies, which are not even controlled in the direct sense by my Department. Where there is a consensus of opinion after a lot of debate, one gets a total of public money, and one then devolves responsibility for the implementation of that policy on industrialists like Sir William Swallow of the Shipbuilding Board, Sir Frank Kearton, of the I.R.C., and Sir William Black, of the N.R.D.C. If only hon. Gentlemen opposite could grasp that this is also public enterprise, and realise that we are engaged in the process of devolving industrial policy on to people with industrial experience, a lot less nonsense would be talked about the objects of Measures such as this.
I am not saying that this is the limit to which we shall go. In our dealings with industry we may find it necessary to come forward with a variety of other Measures. In terms of regional discrimination, we have done so. In terms of investment grants, R.E.P., and so on, there are a number of Measures which it is possible to bring forward. The purpose of the Bill is to get an agreed consensus about the relations between Government and industry, to include the possibility of equity if that is right, and then to invite industrial boards, or industrialists, to implement it by general agreement. If hon. Gentlemen opposite would grasp what we are trying to do, their criticisms of the Bill would be a little more helpful.

Sir T. Brinton: What does the right hon. Gentleman mean by public money rotating? Is there any significance in that phrase?

Mr. Benn: It means exactly what it says, that we take a holding to achieve a result, and when the result is achieved we bring it out again. That is what we have been urged to do by hon. Gentlemen opposite.
I hope that the House will not agree with the Lords in the Amendment, because if it is accepted it will handicap the freedom of industry, of the Government, and of Parliament to reach a sensible solution to some of the problems with which we shall all have to deal.

Question put, That this House doth disagree with the Lords in the said Amendment: —

The House divided: Ayes 152, Noes 88.

Division No. 206.]
AYES
[7.23 p.m.


Armstrong, Ernest
Hannan, William
Orme, Stanley


Atkinson, Norman (Tottenham)
Harper, Joseph
Oswald, Thomas


Barnett, Joel
Harrison, Walter (Wakefield)
Pannell, Rt. Hn. Charles


Benn, Rt. Hn. Anthony Wedgwood
Hart, Rt. Hn. Judith
Park, Trevor


Bidwell, Sydney
Hazell, Bert
Parker, John (Dagenham)


Binns, John
Hilton, W. S.
Parkyn, Brian (Bedford)


Bishop, E. S.
Hooley, Frank
Pavitt, Laurence


Blackburn, F.
Houghton, Rt. Hn. Douglas
Peart, Rt. Hn. Fred


Blenkinsop, Arthur
Howarth, Harry (Wellingborough)
Pentland, Norman


Booth, Albert
Howell, Denis (Small Heath)
Perry, George H. (Nottingham, S.)


Braddock, Mrs. E. M.
Howie, W.
Prentice, Rt. Hn. R. E.


Bray, Dr. Jeremy
Hughes, Rt. Hn. Cledwyn (Anglesey)
Price, William (Rugby)


Broughton, Dr. A. D. D.
Hughes, Emrys (Ayrshire, S.)
Rees, Merlyn


Brown, Rt. Hon. George (Belper)
Hughes, Hector (Aberdeen, N.)
Reynolds, G. W.


Brown, Bob (N'c'tle-upon-Tyne,W.)
Hunter, Adam
Roberts, Gwilym (Bedfordshire, S.)


Brown, R. W. (Shoreditch &amp; F'bury)
Hynd, John
Robinson, Rt. Hn. Kenneth(St.P'c'as)


Buchan, Norman
Janner, Sir Barnett
Robinson, W. O. J. (Walth'stow, E.)


Butler, Herbert (Hackney, C.)
Jeger, Mrs. Lena (H'b'n &amp; St.P'cras, S.)
Roebuck, Roy


Callaghan, Rt. Hon. James
Johnson, James (K'ston-on-Hull, W.)
 Rogers, George (Kensington, N.)


Carmichael, Neil
Johnston, Russell (Inverness)
Ross, Rt. Hn. William


Castle, Rt. Hn. Barbara
Jones, Rt. Hn. Sir Elwyn (W.Ham, S.)
Rowlands, E. (Cardiff, N.)


Chapman, Donald
Judd, Frank
Shaw, Arnold (Ilford, S.)


Concannon, J. D.
Kelley, Richard
Sheldon, Robert


Crossman, Rt. Hn. Richard
Kerr, Mrs. Anne (R'ter &amp; Chatham)
Short, Mrs. Renée (W'hampton, N. E.)


Dalyell, Tarn
Ledger, Ron
Silkin, Rt. Hn. John (Oeptford)


Davidson, James (Aberdeenshire, W.)
Lee, Rt. Hn. Frederick (Newton)
Silkin, Hn. S. C. (Dulwich)


Dell, Edmund
Lee, John (Reading)
Silverman, Julius (Aston)


Dickens, James
Lestor, Miss Joan
Skeffington, Arthur


Dobson, Ray
Lomas, Kenneth
Slater, Joseph


Doig, Peter
Loughlin, Charles
Small, William


Dunnett, Jack
Lubbock, Eric
Snow, Julian


Dunwoody, Mrs. Gwyneth (Exeter)
Lyon, Alexander W. (York)
Stonehouse, John


Dunwoody, Dr. John (F'th &amp; C'b'e)
MacColl, James
Swain Thomas


Eadie, Alex
Macdonald, A. H.
Swingler, Stephen


Ellis, John
Marsh, Rt. Hn. Richard
Taverne, Dick


English, Michael
Mason, Rt. Hn. Roy
Thomas, Rt. Hn. George


Evans, loan L. (Birm'h'm, Yardley)
Mendelson, J. J.
Tinn, James


Faulds, Andrew
Mikardo, Ian
Urwin, T. W.


Fletcher, Ted (Darlington)
Millan, Bruce
Varley, Eric G.


Foley, Maurice
Miller, Dr. M. S.
Wallace George


Foot, Michael (Ebbw Vale)
Mitchell, R. C. (S'th'pton, Test)
Wellbeloved, James


Forrester, John
Molloy, William
Whitaker, Ben


Fowler, Gerry
Morgan, Elystan (Cardiganshire)
Whitlock, William


Fraser, John (Norwood)
Morris, Charles R. (Openshaw)
Williams, Alan (Swansea, W.)


Freeson, Reginald
Morris, John (Aberavon)
Williams, Alan Lee (Hornchurch)


Galpem, Sir Myer
Moyle, Roland
Winnick, David


Garrett, W. E.
Murray, Albert
Winstanley, Dr. M. P.


Gray, Dr. Hugh (Yarmouth)
Newens, Stan
Yates, Victor


Grey, Charles (Durham)
Ogden, Eric



Griffiths, Rt. Hn. James (Llanelly)
O'Malley, Brian
TELLERS FOR THE AYES:


Griffiths. Will (Exchange)
Oram, Albert E.
Mr. Ernest G. Perry and


Grimond, Rt. Hn. J.
Orbach, Maurice
Mr. Neil McBride.




NOES


Allason, James (Hemel Hempstead)
Clark, Henry
Giles, Rear-Adm. Morgan



Atkins, Humphrey (M't'n &amp; M'd'n)
Clegg, Walter
Goodhew, Victor


Balniel, Lord
Cooper-Key, Sir Neill
Griffiths, Eldon (Bury St. Edmunds)


Bennett, Dr. Reginald (Gos. &amp; Fhm)
Corfield, F. V.
Gurden, Harold


Biffen, John
Craddock, Sir Beresford (Spelthorne)
Harris, Frederic (Croydon, N.W.)


Biggs-Davison, John
Crouch, David
Harrison, Col. Sir Harwood (Eye)


Birch, Rt. Hn. Nigel
Deedes, Rt. Hn. W. F. (Ashford)
Harvie Anderson, Miss


Blaker, Peter
Drayson, G. B.
Hastings, Stephen


Boardman, Tom (Leicester, S.W.)
Elliott, Cant. Walter (Carshalton)
Higgins, Terence L.


Body, Richard
Elliott, R. W. (N'c'tle-upon-T,N.)
Hogg, Rt. Hn. Quintin


Boyd-Carpenter, Rt. Hn. John
Emery, Peter
Holland, Philip


Boyle, Rt. Hn. Sir Edward
Errington, Sir Eric
Howell, David (Guildford)


Brinton, Sir Tatton
Fletcher-Cooke, Charles
Hunt, John


Brown, Sir Edward (Bath)
Fortescue, Tim
Iremonger, T. L.


Carr, Rt. Hn. Robert
Foster, Sir John
Kershaw, Anthony




Kirk, Peter
Percival, Ian
Tapsell, Peter


Kitson, Timothy
Pink, R. Bonner
Taylor, Sir Charles (Eastbourne)


Knight, Mrs. Jill
Powell, Rt. Hn. J. Enoch
Taylor,Edward M.(G'gow,Cathcart)


Lane, David
Price, David (Eastleigh)
Vaughan-Morgan, Rt. Hn. Sir John


Legge-Bourke, Sir Harry
Prior, J. M. L.
Weatherill, Bernard


McAdden, Sir Stephen
Pym, Francis
Wells, John (Maidstone)


Maclean, Sir Fitzroy
Rhys Williams, Sir Brandon
Whitelaw, Rt. Hn. William


Maddan, Martin
Ridley, Hn. Nicholas
Williams, Donald (Dudley)


Mawby, Ray
Rossi, Hugh (Hornsey)
Wolrige-Gordon, Patrick


Miscampbell, Norman
Royle, Anthony
Wood, Rt. Hn. Richard


Morgan, Geraint (Denbigh)
Russell, Sir Ronald
Worsley, Marcus


Neave, Airey
Scott, Nicholas



Noble, Rt. Hn. Michael
Sharples, Richard
TELLERS FOR THE NOES:


Page, Graham (Crosby)
Silvester, Frederick
Mr. Reginald Eyre and


Page, John (Harrow, W.)
Smith, Dudley (W'wick &amp; L'mington)
Mr. Anthony Grant


Peel, John
Speed, Keith

Lords Amendment No. 2, in page 2, line 38, leave out paragraph (e), read a Second time.

Mr. Benn: I beg to move, That this House doth disagree with the Lords in the said Amendment.
I gave the reasons for this Amendment in our previous debate.

Mr. David Price: As the right hon. Gentleman implied, the subject of the Amendment was largely covered in our last discussion, so I will be brief, especially as other hon. Members wish to get on to subsequent business. Whether the Government's proposal is carried or the Lords' method remains, there will be a restriction on what the Government can do in the matter of equity, because it is covered by the earlier part of subsection (2), which provides that a competent authority may be authorised to provide "financial support in any form". That seems to over-ride the more limited concession in paragraph (e).
The right hon. Gentleman mentioned his computer Order and challenged our line on it. It depends on the nature of the Order. I am grateful for his offer to discuss it with me. The Order will be unamendable, although there may be one feature, that relating to equity, which we do not like. So, on the Government's insistence on the policy merger—

Mr. Speaker: Order. The hon. Gentleman should link his remarks with the Amendment.

Mr. Price: They are related, Mr. Speaker, in that the right hon. Gentleman intends—I have here his statement of 21st March—to finance the computer merger under just this provision. That is my reason for going into this matter—

Mr. Benn: Not under this paragraph, I think.

Mr. Price: I had assumed that it would be under paragraph (e), which their Lordships have taken out and which the right hon. Gentleman wishes to put back—

Mr. Benn: Yes, I am sorry. It is this paragraph.

Mr. Price: I am obliged. I was worried for a moment.
If their Lordships' removal of paragraph (e) is to be reversed, we should then have to discuss the Order which would be made. Of the £17 million of public money which is to go into the venture, £13½ million will be a grant and only £3½ million will be on equity, so only that amount will be at risk in relation to the Amendment.

Mr. Benn: Without wishing to anticipate the debate on the Order, the whole argument will be, if the hon. Gentleman objects to the equity element, that we must give the £13½ million research and development money without getting any return for it. But this will come forward when the Order is discussed. If the Amendment were accepted, it would put in peril the preparation of schemes of this kind even for the consideration of the House.

Question put and agreed to.
Committee appointed to draw up a Reason to be assigned to the Lords for disagreeing to their Amendments to the Bill: Mr. Benn, Mr. Higgins, Dr. Bray, Mr. David Price, and Mr. Dobson; Three to be the quorum.—[Mr. Benn.]

To withdraw immediately.

Reason for disagreeing to the Lords Amendments reported, and agreed to; to be communicated to the Lords.

HOUSING (FINANCIAL PROVISIONS) (SCOTLAND) BILL [Lords]

Considered in Committee; reported, without Amendment.

Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 55 (Third Reading), and agreed to.

Bill accordingly read the Third time, and passed without Amendment.

Orders of the Day — NATIONAL HEALTH SERVICE (CHARGES)

7.36 p.m.

Mr. Laurence Pavitt: I beg to move,
That an humble Address be presented to Her Majesty, praying that the National Health Service (Charges for Drugs and Appliances) Regulations 1968 (S.I. 1968, No. 759), dated 13th May, 1968, a copy of which was laid before this House on 17th May, be annulled.

Mr. Speaker: Perhaps it would be convenient to discuss at the same time the second Prayer:
That an humble Address be presented to Her Majesty, praying that the National Health Service (Charges for Drugs and Appliances) (Scotland) Regulations 1968 (S.I. 1968, No. 818), dated 20th May, 1968, a copy of which was laid before this House on 23rd May, be annulled.

Mr. Pavitt: I oppose the whole of these Regulations, but the main section to which most of my comments will be addressed are those contained in section 3 of these Regulations which place the charge of 2s. 6d. on every item of prescription. I still find it absolutely incredible that in the light of its history since 1951 a Labour Government should now seek to tax the sick; and I repeat this is a taxation measure and nothing else but a taxation measure. In spite of the exemptions, the sick and disabled will be the people caught by the taxation. The healthy people will be entirely free without any question of making application for exemption.
I believe that this occasion is one of the saddest since I have been a Member of this House. For me it marks the end of a battle which started six months ago when I fired the first defensive shots in a letter to the Daily Telegraph dated 15th

December last. Since then I have moved Heaven and earth to avoid this clash this evening on the Floor of the House. I have tried through all channels and in all possible ways to get the Government to change their mind on these Regulations which are before the House. I particularly made representations to my colleagues in the Government and I was on the telephone to my right hon. Friend the Minister of Health even before the decision was finally announced on 16th January last.
At one time when I had the support of 150 back-bench colleagues I was, I believe, within an ace of success, but my ace was trumped. A miss is as good as a mile and tonight we are faced with the fact that this charge, which is opposed to all the precepts in which I have believed all my life, is before the House. I am sad for myself but I am sad also for my right hon. Friend because with him shoulder to shoulder I fought the battle very solidly until 1964 against these Regulations ever appearing before the House of Commons. My right hon. Friend the Minister has made the greatest achievement in the National Health Service of any Minister since 1951. Not least I pay great tribute to him for something which many hon. Members may not realise, the tremendous job he did, very quietly and with no ostentation at all, when in February, 1965, we had three out of every four family doctors with their resignation in when he yet secured not only the retention of the family doctor service but made the first advances towards health centres that had been made for some 15 or 16 years.
Yet it is because of this one appalling error of judgment contained in this decision that I am sorry for my right hon. Friend because he will go down in Labour Party history not as the man who has done so much but as the man who reversed the principle that for the sick and the disabled in time of trouble there would be no additional financial difficulties and the service would be free. I know the dilemma he is in. He was faced with the choice of two evils. I know the justification he gives for his choice which I believe was entirely and utterly wrong. I will give a quotation from a comment of a Minister of Health:
In the present financial emergency, I have to see whether there can be any increased contribution from the Health Service or any saving on expenditure. I have looked round


the whole of the branches of the service. We are constantly trying to avoid wasteful expenditure;, and I am quite certain that there is no possible way of reducing expenditure, without closing beds or reducing service, except the present alteration of the prescription charge."—[OFFICIAL REPORT, 28th November, 1958; Vol. 561, c. 710.]
But that was said by a previous Minister of Health, the right hon. Gentleman the Member for Thirsk and Malton (Mr. Turton). When my right hon. Friend had to make his decision he was not making it as something fresh but as something with which he had lived ever since 1951; and these Regulations are based on the arguments that took place at that particular period. I said it was wrong to pass these Regulations from my party's point of view. I say that because of the history of the Health Service since the time when Somerville Hastings first started to promote the scheme in 1934, until such time as the late Nye Bevan managed to get it on the Statute Book in 1946 with the appointed day in 1948.
This Order reverses the policy of my party which has been held firmly ever since 1st May, 1952. Again I quote from the OFFICIAL REPORT. The Minister of Health at that time said:
Looking at all these Measures together, the 1949 Act, the 1951 Act and this Bill of 1952, on behalf of my right hon. and hon. Friends I say that when we are returned to power we shall take steps, as soon as Parliamentary opportunity permits, to bring all these charges —charges for drugs, medicines, appliances, dentures, dental treatment and spectacles—to an end."—[OFFICIAL REPORT, 1st May, 1952; Vol. 499, c. 1776.]
The right hon. Gentleman, Mr. Hilary Marquand, made that promise on behalf of Mr. Attlee and the Government at the time, and the rest of us who fought for the Health Service have ever since had that as our creed; and yet these Regulations contravene that undertaking. There have been further evidences and I should like to quote again from the OFFICIAL REPORT, when my right hon. Friend the Prime Minister resigned from the office he then held. On that occasion he said, referring to Measures then being taken comparable to the Regulations we are seeking tonight to annul:
It carries with it, in a time of rising prices, the danger—I should have said the certainty —of further erosion of the social services as year succeeds year. The principle of the free health service has been breached, and I dread to think how that breach might be widened in future years."—[OFFICIAL REPORT, 24th April. 1951; Vol. 487, c. 229.]

It is because of my fear in precisely the same terms and for precisely the same sentiment that I am tonight determined to resist these Regulations to the utmost of my ability. I give a further quotation from the OFFICIAL REPORT, from a person who for many of us was the walking example of what we meant when we talked about compassion for the sick, my late right hon. Friend, Nye Bevan. On that occasion he said:
I have been accused of having agreed to a charge on prescriptions. That shows the danger of compromise. Because if it is pleaded against me that I agreed to the modification of the Health Service, then what will be pleaded against my right hon. Friends next year?"—
I suppose had he had pre-vision he could have said "in 1968".
Indeed what answer will they have if the vandals opposite come in? What answer? The Health Service will be like Lavinia—all the limbs cut off and eventually her tongue cut out, too.
Nye Bevan went on:
Those who live their lives in mountainous and rugged countries are always afraid of avalanches, and they know that avalanches start with the movement of a very small stone. First, the stone starts on a ridge betwen two valleys—one valley desolate and the other valley populous. The pebble starts, but nobody bothers about the pebble until it gains way, and soon the whole valley is overwhelmed. That is how the avalanche starts, that is the logic of the present situation, and that is the logic my hon. and right hon. Friends cannot escape.—[OFFICIAL REPORT, 23rd April, 1951; Vol. 487, c. 42.]
I wish that I had the eloquence of my late right hon. Friend. His remarks say more in a sentence or two about these Regulations than I could possibly put into words. Must we make the same mistakes twice? Does my party have to learn its lesson the hard way and go through all this again? These Regulations are wrong on health grounds, on grounds of social justice, on economic grounds and on political grounds.
They are wrong on health grounds because they will act against early diagnosis, which is the only way by which we can save money and lives in the Health Service. We must diagnose the lump on the breast before it becomes a cancer. We must ensure that the lump is seen by the general practitioner. Nothing deters one from going to the doctor more than a simple excuse not to go, and I fear that the Regulations will provide such an excuse.
They are wrong because they encourage self-medication. I know of only one death which occurred from this, and that happened at the time when prescription charges were last in being. Those charges were removed on 1st February, 1965, to the eternal credit of my right hon. Friend the present Minister. A person with a coronary thrombosis must take what is known in medical circles as T.N.T. tablets for the rest of his life. When the prescription charge was 2s. one could get 100 of these tablets for 1s. 6d. The death of which I speak occurred because the man in question did not bother to get his E.C.10 prescription. He decided that, to save time and money, he would buy the tablets himself and pay the 1s. 6d. Having not bothered to go to the general practitioner, he was not getting his regular checks when going for his tablets, but his heart had deteriorated, and he died. I know of only that one case, but it is one too many.
On the question of social justice, why single out the sick and the disabled to pay? People in working class areas pay three times as much as people in residential areas because they go to their G.P.s three times as frequently. Why make it, "The more ill you are, the more you pay and the less ill you are, the less you pay"? This is an affront to social justice.
I make a particularly strong appeal for the middle aged woman, particularly when at the time of the menopause. When I was a kid in East London mother could never be ill. Father could because Lloyd George had provided him with the National Insurance Scheme. The kids could because no mother would see her child needing medicine and a doctor without providing them. But mother at the change of life suffered pain and discomfort, had to grin and bear it, because she could not afford to go to the doctor. The great emancipation occurred as a result of Nye Bevan's Act of 1946, which made it possible for the ordinary working class mother to see the doctor and no longer have to bear pain in that way. It was an excellent emancipation because she had been, in the main, the one person in the community who had to suffer.
If prescription charges are imposed, the average mother in working class

areas may well decide on Thursday night, if it is a question of buying a meal or buying a prescription—because on Thursday night, the night before the week's pay comes in, there is not much money to spare—to provide a meal for her family and go without medicine for herself.
On these grounds, the Regulations are totally and horribly wrong. For 10 years we pay perhaps as much as £370 in taxation against the day when we are ill, and then we are ill for, say, three months and money is short—we pay a second time for that illness because it is not one of the designations of my right hon. Friend. But in an affluent society this may be a greater disaster than it was in the unemployed 'thirties because now one drops out, so to speak. One cannot keep up the payments on the television and it goes back to the shop. One's children at school cannot talk about the programmes they saw on the "telly" last night. They are dispossessed. Even in an affluent society, illness can add to difficulty, and these Regulations heighten that difficulty. For the first time in 20 years, financial and mental anxiety can now accompany the problem of trying to deal with sickness.
There is no need for me to go into the question of whether or not the Health Service is abused—though some people pay a lot of attention to this question. These Regulations will be the hypochondriac's charter—the person whom the G.P. calls his "Monday morning special". We are not sure why this category should be particularly prevalent on Monday mornings, but the reason is probably because that is the day when she feels most in need of a prop to face the coming week. She can now hand over her half-crown for her medicine, whereupon she has got an entitlement bought and paid for. Even more of our doctors' time will be taken up in this way.
As for Section 5 of the Regulations, my sympathy goes out to the poor rural practitioner who dispenses his own medicines. His relationship with his patients is bound to suffer. A person will go for treatment and the G.P. must say, "Until you give me your half-crown, I cannot give you your medicine." What a paltry sum when one cannot employ a plumber for less than 30s. or an electrician for less than 45s. The patient does not realise


that the half-crown is merely the payment for the E.C.10 prescription form. The relationship between doctor and patient, particularly in rural areas, is bound to suffer and the present good relationship that exists will go for a burton.
The argument that Regulations of this kind are needed to stop abuse is entirely wrong and in 1959 the Lancet published an interesting article which pointed out that, considering the whole history of prescription charges, once one puts an economic basis between patient and doctor one is making a nonsense of the system because there is no financial benefit in the long run and, if there is, it is nothing like what the economists thought it should be.
On 16th January, when the first intimation was made in the House that Regulations of this type would be coming in—we listened in shocked silence to that announcement—one undertaking was given by my right hon. Friend. He said that this time it would be different from the arrangements introduced by the Tories. I give full credit to the Minister of Health because if anybody can perform this sort of exercise in a humane way, it is he. He has shown that he is willing to do everything possible with this evil to make it less evil. Nevertheless, the claim was that there would be exemption for the chronic sick, and most of us expected that all chronic sick would be exempt.
As my right hon. Friend knows —because the doctors would not agree to co-operate—only four clearly defined cases of chronic sick are exempt and at least 60 cases are not. I invite hon. Members to examine the OFFICIAL REPORT for 30th April, in which they will see 44 such cases quoted in Parliamentary Questions to my right hon. Friend. They were all cases of people suffering from acute illnesses, schizophrenics, people who had had angina and people requiring medication for the rest of their lives. All these people are not exempt, although we hope that some amelioration will be given later by some arrangement.
The Regulations should be withdrawn because the Government gave an undertaking which they found they were unable to fulfil. Many chronic sick are not exempt and that is a good reason—not a good excuse—why the Government should have second thoughts and say, "We will

withdraw this Instrument until we are able to fulfil the solemn undertaking we gave". I hope that, for this reason, the Regulations will be annulled.
At this stage I have four questions to ask my right hon. Friend. They concern costing. An announcement has been made about the way in which some of the exemptions will be made. There will be a system of sample checking by the Ministry to ensure that there is no cheating. What will be the cost of this? How many staff will be involved in the necessary checks which the Minister will have to do under the Regulations to prevent people from cheating?
Secondly, how many more staff will be required and what will be the cost in the pharmacy departments of hospitals and elsewhere to operate the scheme which we are discussing under the Regulations? Third, the tremendous advertising campaign in the national papers like the Daily Telegraph, the Observer, The Times, the Sunday Times, and so on— what has been the cost of that enormous campaign?
Finally, what has been the total cost of the scheme, which at one time was estimated at about £800,000 to £1 million to run, in the light of the present arrangements with pharmacists and doctors? What is the total cost of operating this scheme?
These Regulations are wrong, because they are a complete misconception of what the National Health Service is all about. For 20 years we have been seeking to achieve prevention of illness rather than the cure of people who are sick. When we had a Labour Government in 1964, when, in particular, my right hon. Friend was made Minister, there was great jubilation among those of us who had the Health Service at heart, because we knew he would do his best to advance the 20 year old Health Service to the next stage. These Regulations move backwards towards the curing of illness; they are not a help towards prevention. Hospitalisation in a hospital for the acutely sick in my area costs £46 a week for every patient. In the hospital closest to this hotel—[Laughter.]

Mr. David Winnick: Hospital.

Mr. Pavitt: I have been on the Committee on the Finance Bill and for three


days arid nights I have been sleeping and living in this place, and if I have mistaken its function it can hardly be surprising.
The attitude on this side of the House has never been that we spend on health: we invest in it. What we do is to safeguard the health of the community so that it can do all the things we want. We do not think of it as an expense and a loss but as giving the right treatment so that people are not off work and are not away for a fortnight if they can be cured in three days. Ours is the attitude which realises and seeks to alter the sort of situation where more time for production is lost through illness than through strikes. Since 1964 we have lost through strikes 3 million days, on the average, most years. Last year it was only 2·7 million of days of production lost, but last year something like 100 times more was lost through illness. For every one day of strikes 100 days' production were lost through illness.
To produce Regulations like these just prevents people from getting cured. They put a barrier to early diagnosis to speed cure. What nonsense it is, therefore, to come up with Regulations like these to save £25 million in present economic conditions when we ought to be taking large strides in the opposite direction.
In previous discussions here and elsewhere one reason given for why the Government are doing this is that possibly the general public accept it, that there is not a great deal of opposition to it amongst ordinary people. I accept my share of responsibility in that regard. All of us on this side of the House have failed to explain to the people what the Health Service is all about. There is a misconception that it is free. It is not. The average father of a family spends £37 a year on it. Since 1948 and the appointed day most of us have paid £800 into the Health Service, in order to build the hospitals and pay the nurses and pay the doctors and to look after the people of this nation. The average father of a family spends more on two items for his car, his insurance, and his road tax, than he pays for the health of the whole of his family for the whole of a year. And yet in the Labour Party we have failed to identify the ordinary person with this Health Service, which is his.

It is not ours, it is not the Government's. It is something which belongs to us all, to the average person. The nurses, they are our nurses; we build our hospitals. Yet there is this conception that the Health Service is something which is for free. It is something which we the people have built with a good deal of effort and and a good deal of strain.
So on this occasion I say again what I said when the announcement was first made about these Regulations by my right hon. Friend. These Regulations undermine my faith, the faith of a lifetime. My Government have in their team an abundance of ability and of intellectual capacity, and a tremendous amount of integrity, but by these Regulations they have shown a lack of imagination, a lack of vision, a want of fire in the belly which inspired most of us to join the Labour movement. In the Labour movement we have had, the thousands and thousands of foot sloggers in the constituencies, the people who go out and get their feet wet in the service of the movement. It was Nye and the Labour Government who from 1945 to 1951 built on that faith.
Everything rested on the achievements of those days. Nye Bevan clothed very dry as dust legislation with the magic of the brotherhood of man and compassion for the people who needed it. Nye Bevan brought the Act to the Statute Book in a piece of legislation where we put a Socialist principle into legislation to make a practical reality of the hopes and aspirations most of us have so long had. Nye Bevan was a creative dreamer. He saw what many of us also saw, and what he saw was the vision of a kind of world in which there were human relationships, the world we believed in, and be made a practical reality, not just for Parliamentarians, but for the humble —but also for the rich; rich or poor, it did not matter, if there was pain to be relieved.
I have said this before and said it of the right hon. Gentleman with whom I have crossed swords, one of the most brilliant Parliamentarians in the House, the right hon. Member for Enfield, West (Mr. Iain Macleod). I see that he suffers sometimes from pain, as many people do. I do not care if he is a millionaire. If I can help relieve his pain by contributing to the Health Service I am glad to do so,


for it is the element of compassion that matters and I would offer it to anybody. This was the starting point for many of us, the establishment of brotherhood and compassion, and for many of us it was the starting point for activity in politics. These regulations we are discussing tonight take away just that element of compassion and the hope of moving towards a Socialist society.
Even with the Regulations we shall still have the best Health Service in the world. Make no mistake about that. But it will no longer be as Socialist as it was and should be. It will be a Socialist body in which a Tory heart is transplanted. Even if rejection does not take place immediately and tonight, it will no longer provide the inspiration without which the Labour Party itself will die.
The decision we take tonight can in no way be regarded as a vote of no confidence in my Government—in my Government of whom I am proud in spite of present difficulties. These Regulations represent 1½ per cent. of the total Health Service bill for this year, apart from other Government expenditure. If anybody pretends that this is a matter of confidence I can only say that that is just absolute arrant nonsense. I bow to none in this House in my support of this Government and particularly, with his heavy burden, my right hon. Friend the Prime Minister. I supported him in 1960 when it was an unpopular thing to do. I supported him in 1964 when it was a very popular thing to do. I support him now because I think he has done a tremendous job for my party and I do not envy him the hard, tremendous decisions he has to take.
I may lose this battle only to continue the war. I believe that it will be significant to the future of my party and all of us here that on 30th May, 1968, a body of Labour M.P.s, few or many, recorded a vote that a Health Service which was Socialist in concept should remain Socialist in practice. My hon. Friends must decide for themselves what action they take. I have no option. On this matter I shall divide the House and do what I think right, not because it satisfies my conscience, but because it is right for my party.

8.11 p.m.

Dame Joan Vickers: I congratulate the hon. Member

for Willesden, West (Mr. Pavitt) on his sincerity. He and I have worked together on a Private Member's Bill, and I should like to congratulate him on getting that through. I am certain that this must be one of the Minister's saddest days. I have supported him, too, on a Private Members' Bill, and I know many of his ideas on these matters.
However, I want to ask one or two practical questions. When the Health Service charges were first put on by a Conservative Government, I abstained, but I voted on the second occasion when there was a chance of getting the money back, and I still prefer that scheme to this, because I think that this is illogical. How much money is really being saved? The hon. Member mentioned the advertisement, but I should like to know whether the advertisement is also appearing in some provincial papers, because my constituents cannot afford to buy the Daily Telegraph. They probably would not want to read it if they could. Is the advertisement appearing in the Daily Mirror and the Western Morning News, or the Western Evening Herald, which goes into one in every four houses in Plymouth?
What will be the cost of the token books and leaflets? The leaflet Form PC11 measures 6½ by 4½ inches. One doctor has already written to the newspapers to say that intelligent patients may be amused by the form, but that the elderly will be unable to read the tiny print and the unintelligent will be utterly bewildered. If we are to have this scheme, and presumably we are, what is the good of sending out a leaflet which will be unintelligible to the people whom we most want to help?
Why should the arbitrary age of 15 be chosen for schoolchildren? We hope that many children, particularly those from poorer families, will stay on at school until they are 16, and it is the poorer families about whom I am worried. I know that there are 11 million children under 15, but would it not have been better and slightly more selective and a help to the lower income groups—which contain the children whom we want to stay at school until the age of 16—if all children under the age of 16 had been exempted, except those whose parents could afford to pay for them to go to grammar school?
What is the point of the age of 65 for all persons? There are many single women and widows who have just enough to live on with their pensions, but who will not be eligible and who will have to wait until they are 65 before they can get any help. I am not at all happy about the situation of unmarried mothers. An expectant mother, according to the advertisement, has to go through a terrific rigmarole to get help. She has to apply for welfare milk tokens and her application has to be sent to the Health Service Executive Council. Are we certain that all this can be kept private? Such a woman will be nervous about making an application.
I have been interested by the list of diseases. Does the right hon. Gentleman think that it is compassionate that people should always know from what type of disease they may be suffering? I am not a doctor, but there are many doctors in the House, and I should have thought that to be told that one had one of these diseases might militate against an improvement in health, and the patient might even learn that his disease was incurable.
The hon. Member for Willesden, West mentioned one group of patients who are incurable, the chronic sick. These are not included, but I should have thought that everybody had been moved by the Disablement Income Group to think that they should have some kind of pension, and yet they are now to be made worse off than ever before.
Is the list final? Even though there is now a cure for tuberculosis, T.B. and asthma are often permanent diseases and surely people in the throes of tuberculosis need help. Will the right hon. Gentleman consider adding to the list if that is necessary?
The advertisement says:
The Ministry of Social Security will send you"—
an exemption certificate—
with your next order book.
The advertisement says:
If you have an order book you don't have to apply for an exemption certificate".
How will the National Health Service Council know if and when to send a new one? Will there be, as in a cheque book, a form to remind them, because


they will not know how many prescriptions a week they may require, and I do not see how they will know when to send for the next form.
The advertisement says:
Form PC. 11, available from any post office or Ministry of Social Security local office, explains who may claim and how to do it.
Are Post Office officials to be informed how to fill in these forms? If so, will not that create a lot of work and difficulty?
The advertisement refers to war pensioners. Does this refer only to Service pensioners or does it include, for instance, civil defence pensioners? It says:
Those awaiting an exemption certificate from the Executive Council will have to pay the charge, and claim a refund after the certificate arrives.

In certain areas, it may take a long time to arrive. How long is it expected people will have to wait?
The Regulations say:
a continuing physical disability which prevents the patient from leaving his residence except with the help of another person …
will be exempt. How is this to be defined? A blind person often cannot go out without the help of another person, but he is not necessarily sick. The whole scheme is very illogical.
The advertisement says:
If you require numerous prescriptions, but are not entitled to exemption or refund, it may later be possible for you to buy a card entitling you to pay no further charges for a period of time.
I know that this provision is not to be implemented at once, but I should like to know why it has been included in the advertisement and what it means. Who is to be covered and how does one buy a card? This is an extraordinary situation.
I am very disturbed by these Regulations, because the low income groups and single women and widows under 65 will be hit as usual by this Government. I hope that the right hon. Gentleman will give us some indication of how he means the scheme to work and some indication that his mind is not completely shut to further alterations if they prove necessary.

8.20 p.m.

Dr. A. D. D. Broughton: I begin by repeating


an opinion which I have voiced in the House on a number of occasions, namely, that in principle I favour a free National Health Service. 1 know that I am not alone in holding that view. It is shared by my right hon. Friend the Minister of Health and by my hon. Friends. My reason is that I regard a free Health Service as being necessary to ensure that no financial obstacle stands in the way of any patient needing treatment. But I realise that we cannot have all we want regardless of cost.
Our country is faced with economic and financial problems, and it is imperative that cuts be made in Government expenditure. The Health Service is a heavy expense on the Exchequer, and the Government have decided that it is not unreasonable, in the present difficult circumstances, to cut down on some of the cost. I am sure that every item of Government expenditure has been examined, and the decision has been reached to save on prescription costs. I very much regret the imposition of these charges, but I feel that I must accept them as necessary at present. It is my hope that our country will soon reach a position of economic prosperity and financial stability and then be able to afford to abolish these charges.
Having expressed my opinion on prescription charges, I wish now to examine the Regulations in relation to one or two points which I have in mind. When the announcement about the imposition of prescription charges was made, every hon. Member knew that certain categories of people would have to be exempted. Paragraph 7 of the Regulations gives the list, and it includes persons under 15, aged 65 and over, expectant and nursing mothers, those in receipt of supplementary allowance, and those suffering from certain chronic diseases and continuing disability.
The list is very good as far as it goes. But why was the age of 65 selected for both sexes? It may well be the right age for men, but 60 is regarded as the retirement age for women. If a retirement pension is payable to women at the age of 60, why not exempt them from prescription charges at that age? This matter has been mentioned already by the hon. Lady the Member for Plymouth, Devonport (Dame Joan

Vickers) and I request my right hon. Friend to look at it again and to see his way to granting women of 60 years of age and over free prescriptions. I am sure that they are deserving of this small kindness.
I was surprised to find that persons suffering from tuberculosis are not included in the list of exempted persons. My attention was drawn to this omission by a consultant chest physician who treats patients in my constituency. He wrote to me saying:
I am concerned about the imminent imposition of charges for prescriptions. I understand that anti-tuberculosis drugs will not be exempted. All tuberculous patients have, of course, to continue these drugs for a period of one and a half to two years and take not less than two and usually three at a time, and also, of course, the cure of the disease depends on taking the drug for this length of time. The incidence of tuberculosis is highest in the poorest sections of the population.
He went on to say:
It is difficult enough in many cases to get the patient to continue taking the drugs for this length of time even when they are given free.
He concluded:
I feel that the present good progress in the eradication of tuberculosis will be prejudiced if these drugs are not included in the list of exemptions and I am writing to ask if you can help in this.
A similar letter was written by that consultant to my hon. Friend the Member for Dewsbury (Mr. Ginsburg) with whom I have discussed the problem. I know that my hon. Friend sent his letter to the Minister. Therefore, my right hon. Friend will be acquainted with the problem. He will have had an opportunity to give it thought, and I hope that I shall receive a satisfactory answer this evening.
I am aware that the present list of exempted persons will allow exemption for some, and perhaps most, cases of tuberculosis—for example, those cases occurring in persons under 15, or 65 and over, pregnant women and persons drawing supplementary benefit. But the consultant who wrote to me and to my hon. Friend the Member for Dewsbury is right in thinking that not all tuberculosis patients will be covered by the present exemptions.
I say emphatically that I consider that it is of vital importance that all drugs needed for the treatment of tuberculosis should be supplied to patients free of


charge. This is necessary partly for the patient's sake, but also, and particularly in cases of pulmonary tuberculosis, to protect others from the spread of a serious, deadly and infectious disease.
While considering this matter, I have thought about patients suffering from other infectious diseases. I will not weary the House by going through the list and giving details of them. But I urge the Minister to include all cases of notifiable disease among the exemptions. I regard that as advisable and, indeed, as necessary to keep down the spread of infectious disease. Compassionate feeling for certain categories of people has been shown in compiling the list of exemptions, but it appears that the need to protect the community from infectious disease may have been overlooked. I repeat my urgent request that all who suffer from any notifiable disease be exempted from paying prescription charges.

8.29 p.m.

Mr. Philip Holland: I endorse what the hon. Member for Batley and Morley (Dr. Broughton) has said and I support his argument. Before I do so, I feel that it is my duty to confess to the hon. Member for Willesden, West (Mr. Pavitt) that I have been guilty this week of the sin of self-medication. This was not due to the imminence of Health Service charges but rather to my strong attraction to the enchanting hotel to which he referred, which has precluded me from spending time in my own doctor's surgery. I am sure that he will not expect me to go all the way in agreement with everything he has said, but I do agree with some of his points. I propose to keep what I have to say very short, because one of the by-products of a cold in the head and a throat infection is that it is difficult to concentrate, and if one goes on for too long nonsense results.
My constituency encompasses three coal-mining areas, and I have a special interest in pneumoconiosis and other respiratory diseases which are caused by dust and which afflict those who work underground. I am surprised that these notifiable diseases have not been included in the exemptions.
I do not confine my plea to the pneumoconiosis group of diseases. The Min-

istry of Social Security Leaflet N.I.2 lists 44 notifiable diseases, including tuberculosis. Two more are listed in the leaflet N.I.3, and they are pneumoconiosis and byssinosis. I cannot understand why the right hon. Gentleman has not included in the exemptions a clearly defined area of hardship. Many of these diseases are disabling, but not totally disabling. They result in suffering and also in reduced earning capacity. I should have thought that this group of diseases was an obvious area of hardship. Surely, the essence of having exemptions is to try to categorise hardship. I am sorry the right hon. Gentleman has not included these diseases, and I support the plea of the hon. Member for Batley and Morley for them to be included. I am sure that a way can be found if the Minister has the will to do it.
I too have had a letter about tuberculosis from a consultant chest physician in a hospital which serves my area of Nottinghamshire. He said much the same as the consultant chest physician said in the extract from his letter which was read by the hon. Gentleman the Member for Batley and Morley. I quote the last paragraph of the letter which I received:
The incidence of tuberculosis in this country has declined enormously and is still falling. It would seem unfortunate if this should be impeded by the imposition of prescription charges.
I echo those words. It will indeed be unfortunate if the imposition of prescription charges and the failure to exempt a clear area of hardship impedes the early treatment of those disabilities, the neglect of which in the early stages can have such devastating consequences.
I too have sent a copy of this letter to the Parliamentary Secretary, and I hope that we may have a response to this plea, but, please, not only to the plea for the tuberculosis patient but to the plea for the notifiable diseases across the board. I am sure that this is an area which can easily be identified as an area of hardship, and these are the people who should be exempt from charges.

8.33 p.m.

Mr. Alex Eadie: Since it was the will of the House that both Regulations should be taken together, I wish to speak to them and to comment on how Scotland will be affected by prescription charges. I believe that the Scots


aspect must be considered, although the effect and implications will be the same. I will not repeat the argument already made against the imposition of prescription charges. In my opinion, this is a breach of principle for my party. Try as we may, we shall never escape from the logic that prescription charges are a tax on the sick and injured who will not be covered by any exemption.
The Minister of Health will try, I am sure, to administer the proposed change with compassion and understanding. Indeed, I understand that about 50 per cent. of the people of Scotland will be covered by exemptions. No doubt that can be confirmed by the Minister. However, the introduction of exemptions is bound of itself to create anomalies, because of the difficulty of definition. Although the debate has just begun, anomalies are already beginning to show themselves.
Perhaps I may give one example in a little more detail. I have said repeatedly that, before I came to the House, I had been a coal miner for 30 years, and I am proud to be able to say that. My right hon. Friend will recall that, when the possibility of prescription charges was first announced by the Government, I put down a number of Questions about pneumoconiosis and silicosis.
It is assumed by the general public that miners and other workers who are pneumoconiotics are unable to continue working. I do not want to debate the merits or otherwise of men continuing to work in mines when they have pneumoconiosis, but many do, and any medicine that they need is not just for their own personal comfort. They need it to keep themselves at work. As a result of this change of policy, they will have to pay to keep themselves at work.
A man who is able to keep at work is a source of wealth to the country, and I cannot understand why we should seek to undermine the man who wants to carry on at work and who, as a consequence, will have to pay to do it because he has pneumoconiosis. As has been said before, this is a tax on the sick.
Before I came to the House, one of the men working with me was a pneumoconiotic. Frequently, he had to leave work early, he was always taking pills, and he suffered all the time. He always had trouble with his chest. I cannot understand the logic behind a proposal which

still taxes these people who, apparently, are not covered by any exemption.
However hard my right hon. Friend tries, the amount that an individual pays in prescription charges is largely determined by his occupation. I have had some experience of heavy industry, and I know that the work people engaged in it will have to pay more in prescription charges than those in other sectors. It is a curious situation and, when people come to recognise it, there will be bitter opposition and resentment among those employed in heavy industry.
I do not subscribe to some of the arguments which have been advanced. I feel that, sometimes, we tend to over-exaggerate the impact on the industrial sector of the announcement about prescription charges. I do not believe that people are yet indignant about this. I wish they were. The activists in our movement are indignant about it, but the people have not yet realised what it will mean when prescription charges are introduced.
I have grave doubts whether the scheme will be workable in Scotland. There is no secret that the pharmacists in Scotland are in dispute about the working of the scheme. The Minister must give the House more information about this when he winds up the debate. Today, I received a telegram from Scottish pharmacists. I shall read it because I think it pertinent to the debate. It is addressed to me and it says:
Scottish chemist contractors have been unable to reach agreement in Whitley Council on payment for operating prescription charges scheme. Request you approach Secretary of State on chemists' behalf. Gladly supply further details by telephone.
It is signed by the representative of the Pharmaceutical General Council in Scotland.
There are great reservations about how the scheme will be implemented. A constituent of mine wrote to me when the announcement was made. He is a practising pharmacist with a rather large business. He wrote:
The charge is to the 2s. 6d. per item. I am presented, say, with a form which contains three items. I ask the patient for 7s. 6d. They reply that they have not got 7s. 6d.— could they hand it in later? What am I to do? Do I give them credit and never see them again or have I to be heartless and refuse them medicine which may be essential? Thus, I am subsidising the drug bill myself to the tune of 7s. 6d. Or the patient may say, ' I have only 5s. I will take two of the items


and leave the third one. Why should I be placed in the position of deciding which items are essential and which are not? This is not my job—it is the doctor's. Believe me, these things really happened under the old scheme of charges and they will happen again.
There speaks the voice of experience.
When we were discussing the implications of this scheme some of us suggested that the cost of administering prescription charges with exemptions would make a nonsense of the introduction of charges. The Minister has a duty to give us information this evening. I have tried by Parliamentary Question to find the cost. I found that in my area in 1967 the gross cost of prescription charges was £87,907. In a Question to my right hon. Friend the Secretary of State for Scotland I asked what the gross cost of prescription charges under the Health Service was. He informed me that in 1967 it was £16,344,250.
In HANSARD of 22nd May we were informed that the cost of exemptions in Scotland would be about £2·5 million. This brings us to a ridiculous state of affairs. We are entitled to know what the administrative cost of the scheme will be. We have not had the information yet, even though I and some of my hon. Friends have tried to get it. My hon. Friend the Member for Falmouth and Camborne (Dr. John Dunwoody) tried to get the information two days ago, and anyone who reads the Answer will find difficulty in understanding what it means.

Mr. Adam Hunter: My hon. Friend says that the exemptions in Scotland will cost about £2·5 million. As this represents about 50 per cent. of the people in Scotland, the total cost for prescription charges is only about another £2·2 million in Scotland.

Mr. Eadie: My hon. Friend has a good point. It emphasises what I said at the beginning of my speech, and it points out how ridiculous the debate is.
I want to deal with the important question of administration. It is difficult to get the costs. Perhaps we can get an inkling of what it will cost to implement this breach of principle through a Question answered on Monday, 27th May, by the Minister of Social Security. The reply was:

"The total administrative cost of my Department in the last financial year (1967–68) was about £94 million divided as follows:



£ million


Sickness benefit
17


Unemployment benefit
1


Retirement pension
21


Other national insurance benefits
5


Total national insurance benefits
44


Industrial injuries benefits
8


Family allowances
5


War pensions
4


Supplementary benefits
26


Administration on behalf of other Government Departments
7


Total
94

—[OFFICIAL REPORT, Monday, 27th May, 1968; Vol. 765, c. 154.]

The point I am trying to make is that the cost of administration will make this saving even more ridiculous. The Minister must be more forthcoming in his reply, and tell the House precisely what it will cost to administer the scheme. It is not clear for what period the exemptions will apply and to what conditions they will be subjected. Will it be made a condition of exemption that financial circumstances do not change? If so, what about those with fluctuating earnings? Will it be necessary to report any change, however small, to the Ministry? Will people commit an offence if they fail to do so?

I consider the Regulations to be unjustified. I do not believe that the Government can defend the indefensible and I must ask my right hon. Friend, even at this late stage, to announce that they will not proceed with what I believe to be a serious violation of principle.

8.50 p.m.

Mr. Brian Harrison: I do not think that there is anyone in the House who has not a great deal of sympathy for the right hon. Gentleman the Minister of Health, who finds himself in such a dilemma. He has frequently come out against the introduction of any form of charges on the National Health Service and now finds himself having to decide either to cut the Service in other directions or reintroduce prescription charges, which I must admit some of us feel should never have been removed in the financial situation which we are led to believe existed in 1964. While I feel sorry for the Minister of Health, I feel even more worried about the position of


the Prime Minister in this situation, in view of his earlier resignation on just this issue.
I hope that the Minister of Health will keep a flexible attitude towards how the charges are to be collected and towards which diseases will be exempted. I draw his attention, in particular, to tuberculosis. Two very exciting things have happened since I first became interested in the health services, 16 years ago, and they happened within a few miles of my home and my constituency.
One of them is the complete run-down of a big tuberculosis hospital. There is a real danger that there should be carriers in the community at present and I would like to see people who have this long period of medication—18 months to two years—included in the exempted illnesses.

Mr. Kenneth Lomas: Would not the hon. Gentleman agree that mental illness and coronary thrombosis should also be exempted?

Mr. Harrison: Perhaps the hon. Gentleman is telepathic, because the other exciting thing in my knowledge which has happened in my area is that I have seen long-stay mental patients becoming part of the community again because so much progress has been made. There are certain types of mental illness that should probably be included amongst the exemptions. I am grateful to the hon. Gentleman for pulling me up on that point.
I now turn to the administrative arrangements. There is a possibility that the Minister is being very clever here, that the cost of administering the exemptions will be such that the saving to the Health Service through the charges will be roughly equalled by the cost of administering them.
There cannot be a chairman of any hospital management group who has not at present had to put a ceiling on recruiting of administrative staff, or, if any recruiting is done, it must be at the cost of another post in a hospital. Yet there is in the Circular, H.M. (68)30 in the Library the following instruction:
When out-patient clinics are held hospitals should arrange for an officer to be available to inform patients claiming exemption whether they can be exempted or not.
The additional staff that will be needed to advise patients and help them fill out

their forms, and to help in the collection of the money and in making the additional records will put a very great burden on the already heavily overworked administrative staff in most of the out-patient departments in our hospitals. Various office machines will be needed, costing about £50 to £70 apiece. There will need to be two in practically every out-patient clinic, and the cost will be fairly excessive.
I hope that the Minister will consider very carefully, after the administrative arrangements have been going for a short time, whether it is possible to simplify them, to cut down their cost so that any saving through the charges will be able to go into the Service and provide a lasting benefit to it by increasing the funds available to be spent in other directions.

8.57 p.m.

The Minister of Health (Mr. Kenneth Robinson): It may be for the convenience of the House if I intervene at this point. My hon. Friend the Under-Secretary of State for Scotland will wind up the debate and deal with those points of detail with which I cannot deal in my speech.
My hon. Friend the Member for Willesden, West (Mr. Pavitt) will not be surprised when I say that it gives me no pleasure to reply to the Prayer moved by him and supported by my hon. Friends—

Mr. J. J. Mendelson: My right hon. Friend has just announced that there will be two Ministerial speeches in a very brief debate. When so many hon. Members wish to speak, is it really necessary that the Government should take such a lion's share from the limited time available?

Mr. Robinson: I thought that it would be better for the House if I replied to the main principles of the debate and my hon. Friend replied to the Scottish Prayer—there are two Prayers under discussion.

Mr. Mendelson: Why not take two days?

Mr. Robinson: It is not the view of the Government, as it appears to be of the party opposite, that prescription charges are a good thing in themselves. Lest there be any doubt let me make it clear


from the outset that the Government regard their reintroduction as a regrettable necessity, and it is primarily on the grounds of economic necessity that I seek to defend the making of the Regulations. I have made my view known widely, over a long period, that ideally the National Health Service should be free to everyone at the time of need, and it is not at all difficult to find telling quotations from past speeches of mine over the years.
But the ideal of a free service lasted in fact barely three years from its inception—charges of some kind have been in operation ever since 1951. It is true that before coming to office we hoped that we would in time be able to restore a completely free service, and we undertook specifically in our election programme of 1964 to abolish prescription charges. That pledge we redeemed, despite an economic situation far more adverse than anything we had contemplated, and I am glad we took the decision to do so.
Sometimes I think that some of my hon. Friends are almost implying that in the light of this decision it might have been better had we never abolished the charge in 1965. If that is so, they overlook two things. First, the obvious fact that for three years the entire public had the benefit of free prescriptions. In no other country, as far as I am aware, does this happen. Secondly, that, far from re-introducing the arrangements that obtained when we came to office, these regulations cover a wholly different system, and one which goes as far as is practicable towards exempting from having to pay all those who might find prescription charges oppressive.
Under the arrangements which we got rid of in 1965, everyone paid the charge including the chronic sick, the old-age pensioners, the children, and the expectant mothers, unless they were on supplementary benefit or their incomes were around that level, in which case they were eligible not for exemption, but for a means-tested refund, and by no means all who were entitled to a refund did in fact obtain one.
Under the scheme covered by these Regulations no fewer than 20 million people, over 40 per cent. of the population of England and Wales, will be exempt from the charge. Put another

way, something like half the prescriptions issued will be dispensed free of charge. The same kind of arrangements for refund of the charge on grounds of financial hardship will operate as before, but there will be far less recourse to them, for the simple reason that many who would qualify for refund are already exempt because of age, and also because my right hon. Friend the Minister of Social Security has arranged that everyone on long-term supplementary benefit will be issued with an exemption certificate with their next order book.
I will deal with some of the detail and the specific criticism later, but this, broadly, is the scheme. Why did the Government introduce it? It formed, of course, part of the measures taken by the Government in the new year to cut back the rise in public expenditure announced by my right hon. Friend the Prime Minister on 16th January. I do not think that this is the occasion for me to justify the necessity for the £300 million cut in the programmes for 1968–69, with large savings in subsequent years. But I do not think that anybody would suggest that we cut back too much. The figure was, however, a large one by any standards, and every spending Department, including all the Social Service Departments, was called upon to contribute. It was unthinkable that Health Department, responsible as they are for about one-ninth of total Government expenditure at home and overseas, could escape.
There are, broadly, three alternatives open to a Minister of Health in this situation. Cutting back on services to patients, by abandoning in whole or in part certain specific services, like the dental or ophthalmic services, or cutting back on capital expenditure or some extension of charges to patients.
I can assure hon. Members that there is no way of securing savings of the order required by the Chancellor of the Exchequer through economies in hospital revenue expenditure. To have cut back to this extent would have meant serious curtailment of services, dismissal of staff or inability to open new hospital buildings for lack of money. This, bearing in mind that, as it is, the hospital service is under great pressure to maintain services and develop them to a modest


extent on the limited rate of growth the programme permits, was something which I could not contemplate.
Nor could I envisage abandoning one or other part of our health services. The only practical alternative to an extension of charges was a cutback in the hospital building programme. It is true that we have in the last few years achieved a steady build-up in the hospital capital programme. But it has taken years to achieve this momentum and to gear all the planning and design procedures to fit in with it. Even now we are barely keeping pace with obsolescence, despite the expenditure of more than —100 million a year on hospital building. Should I have agreed to a cut-back here as an alternative to prescription charges? I doubt whether anyone who appreciates the scale of the cut that would have been needed would say that I should.
Because the expenditure on a major building scheme like a new hospital is relatively small in the first year, and probably does not reach its maximum until the third, it would have been necessary to defer the start of almost every new hospital planned to start in the next two years at least; and we need those hospitals desperately. Such a decision, quite apart from the devastating effect on morale throughout the service, would have involved a break-up of planning teams, and set back a carefully built-up and expanding programme from which we should have taken something like 10 years to recover.

Mr. William Molloy: That is a poignant argument, and a good one in the context of reducing or imposing charges, but what we are concerned about is why these charges were introduced at all. If cuts had to be made, they ought to have been made other than in the Health Service.

Mr. Robinson: Cuts were made in Social Service Departments as well as in all other Government Departments.
Were we wrong to take the view that prescription charges, with generous exemptions for those who might be hurt by them, was the preferable alternative? I can only tell the House that after three years' responsibility for this great service, I had no doubt whatever that this choice, however distasteful to me and to my right hon. Friends, was the one that did

the least damage to the Health Service and its patients.
Apart from their objection to charges in principle, the main criticisms of the Regulations voiced by my hon. Friends here tonight, and elsewhere, relate to the alleged complications of the scheme, and to the arrangements for the chronic sick.

Mr. Frank Hooley: Mr. Frank Hooley (Sheffield, Heeley) rose—

Mr. Robinson: As there have been complaints about there being two Front Bench speeches tonight, I think that it will be better if I proceed with my speech.
As to the first point, the present scheme, as the House knows, has been designed as an interim arrangement, and the mechanics may possibly be altered at a later date. But the arrangements which we are now proposing could really not be much simpler, given what we are trying to achieve.
I have already mentioned that about 20 million people will be eligible for exemption. Approximately 17 million of these, or well over 80 Per cent. of the exempt categories, are eligible on age grounds, and will secure exemption from the charges merely by completing the appropriate declaration of entitlement to exemption on the back of the prescription form.
We are able to make this simple arrangement because records of their ages will be readily available for later checking. People in the other categories must first obtain an exemption certificate so that there shall be some record available of the grounds for their entitlement, but to secure exemption they then merely declare that they possess a certificate. A parent or guardian can sign the declaration for a child and a neighbour or friend collecting the medicine for a sick person may complete the declaration on his behalf.
Perhaps I might add that the scheme would have been simpler still but for the very welcome arrangement which my right hon. Friend the Minister of Social Security has been able to work out, whereby large numbers of people receiving supplementary benefit can be exempted from paying the charge, instead of having to pay and then seek a refund


as they used to when charges were in force before. Here we are doing much better than was envisaged when the decision was announced in January.
I might also mention that we are doing better in that it has not been necessary, as we once thought it might be, to reintroduce the charges in the first place merely with refund arrangements, leaving exemption to be provided for later when my discussions with the professions were complete. In the event, we were able to hold back the reintroduction of the charges for a short time so that the exemption arrangements could be operated simultaneously, just as my hon. Friends pressed me to do.
The procedure for obtaining exemption certificates will be straightforward. The Ministry of Social Security will be able to issue them for many of those for which they are responsible without any application having to be made, and, although applications will be required for certificates issued by Executive Councils, we have again made the procedure as simple as we can. These arrangements have been worked out in conjunction with the medical and pharmaceutical professions. Extra burdens will fall on the members of both professions—chemists, in particular, have a vital part to play, since it is to them that the charges have to be paid by those, of course, who are not exempt—and also on Executive Councils. I am grateful to all concerned for their co-operation.
I am particularly anxious that people should exercise to the full their entitlement to exemption or refunds. It is no use giving people rights if they do not use them. I agree that, at first sight, the scheme looks a bit complicated— these things always look more complicated in Regulations—but this is because we are exempting so many categories. In fact, the procedure for each category is quite simple—for the largest ones, the old and the young, very simple indeed— and this should help.
We are doing all we can to ensure that people understand how the scheme works. We are making use of broadcasting—I explained the scheme on television last week—and large advertisements are being inserted in the national

and provincial Press. That is the answer to the hon. Lady the Member for Plymouth, Devonport (Dame Joan Vickers). Explanatory leaflets are available in post offices, and there are notices for display in doctors' surgeries and chemists' shops. I shall, of course, be keeping a watch on the position as it develops after 10th June, so that further steps can be taken if need be; but I hope that enough has been done to ensure that the public are properly informed.
My hon. Friend the Member for Willesden, West asked about cost. He asked, first of all, what was the cost of checking. We think that this will probably be between —50,000 and —70,000 a year. The cost of the Press campaign and publicity is about —70,000. It is difficult to say what the number of additional hospital staff will be, but it will certainly be very small.
As to the average running costs, he seemed to be confusing two things. He quoted a figure which had been mentioned as the initial cost of the proposed longer-term scheme, which is still under consideration, but this was nothing to do with the running costs. The estimate which I would give of the running costs of the present scheme is about —250,000 a year, which is about 1 Per cent. of the total saving.
In devising these arrangements, the greatest difficulties arose over the chronic sick. This we had always foreseen; and it was always made clear that there could be no certainty, until we had had discussions with the professions, that it would in fact be possible to make exemption arrangements for this category, however much we wished to do so.
The House will accept, I am sure, that, when it comes to identifying a chronically ill patient, only the doctor can do it. At first, the representatives of the medical profession who were appointed to discuss this problem with us stated firmly that general practitioners were unwilling to do this at all. In case some hon. Members read into this an attitude of non-co-operation with the Government, let me say I do understand their reluctance. No doctor is anxious to differentiate between one patient and another to determine who shall pay and who need not, particularly where judgment would have to be largely subjective.


The doctors represented to me that such a situation would lead to endless argument with patients, and would seriously impair the doctor-patient relationship.
We tried very hard together to discover objective criteria for defining the chronic sick in the wider sense, but we were not successful in finding any formula which satisfied the doctors. Eventually, however, after prolonged negotiation, we did agree on a list of conditions which, because it relied on medical fact rather than judgment, avoided the difficulties which I have described. The categories are, I admit, narrower than I would have wished, but to widen them was quite unacceptable to the profession for the reasons I have given. We always knew, I repeat, that we could exempt the chronic sick only to the extent that their family doctors were willing to identify them.
Hence the somewhat cautious wording of my right hon. Friend the Prime Minister's original statement. I must tell my hon. Friend the Member for Willesden, West that it could not have been an "undertaking"—the word he used. In fact, we have done better than at one time looked possible, and I am satisfied that this perhaps rather narrow definition of the chronic sick is the best that could be arrived at.
The overall result was that about 20 million people will be entitled to exemption. This, I think, is an impressive figure. It is true that, even so, there may be instances of hardship—though we must remember that there will be refund arrangements as a fall-back. Some would argue that, in any scheme involving entitlements, a line must be drawn somewhere, and that some people whom one would wish to help will come just on the wrong side of the line.
This is true; but there is one category of patient which, though not a very large one, I am particularly anxious to help. It consists of patients who are not chronically ill within the definition agreed for this purpose, but who do need unusually frequent prescriptions. I am thinking here of patients suffering from chronic conditions, including psychiatric

disorders which may call for regular drug treatment over considerable periods and also of the person—for example, the man has bronchitis regularly in the winter —who may not need continuous medication, but who requires numerous prescriptions at intervals. This group includes almost all sufferers from those conditions and illnesses so far mentioned in this context in this debate.
We have not been able to exempt them completely, and I have explained why; but we intend to help them by enabling them to buy for a sum representing the cost of, perhaps, two prescriptions a month, a rate of Is. 3d. a week, an exemption certificate for a fixed period. The Health Services and Public Health Bill, which will be coming back to this House fairly soon, has been amended in another place to give me the necessary powers for this. If this new Clause is agreed, I shall in due course be making Regulations dealing with the purchase of these certificates.
This cannot be done at once, because the Bill is not yet on the Statute Book. There will be some practical problems to solve, but I want to introduce the arrangements as soon as I can, and I want particularly to see them operating by the winter.
Given the need for prescription charges, I think that our aim to ensure that they will operate so as to be socially just has been broadly achieved—though I do not pretend that these charges will be welcomed by those who have to pay them. What charges ever are? But all the indications are that the public understands why we have had to take this step, and accepts it.
I know how my hon. Friend the Member for Willesden, West feels about these Regulations. He spoke of the Health Service in terms which certainly moved me and, I think, moved the whole House. On this issue he has fought a long and valiant fight. I hope that when we reach the end of this debate he and my other hon. Friends will not feel it necessary to carry their opposition to these Regulations to a Division.

Orders of the Day — ROYAL ASSENT

Mr. Speaker: I have to notify the House that in accordance with the Royal Assent Act, 1967 The Queen has signified Her Royal Assent to the following Acts:

1. Local Authorities' Mutual Invest-ment Trust Act, 1968.
2 Export Guarantees Act, 1968.
3 Firearms Act, 1968.
4 Wills Act, 1968.
5 Trade Descriptions Act, 1968.
6 Air Corporations Act, 1968.
7 Housing (Financial Provisions) (Scotland) Act, 1968.
8 Industrial Expansion Act, 1968.
9 Mill Lane, Kirk Ella, Burial Ground Act, 1968.
10 All Saints, Streatham Act, 1968.
11 Holy Trinity, West Hampstead Act, 1968.
12 University of Salford Act, 1968.
13 Royal College of Art Act, 1968.
14 Christ Church with Saint Andrew and Saint Michael, East Greenwich Act, 1968.
15. Mersey Tunnel (Liverpool/Wallasey) Act, 1968.
16. Salvation Army Act, 1968.

And to the following Measure, passed under the Church of England Assembly (Powers) Act, 1919:

Pastoral Measure, 1968

Orders of the Day — NATIONAL HEALTH SERVICE (CHARGES)

9.20 p.m.

Dr. M. P. Winstanley: It is not long since I spoke in the Second Reading debate on the Health Services and Public Health Bill. On that occasion I concluded by saying that I hoped that no hon. Member on this side of the House would seize that opportunity of raising the red herring of prescription charges. I recollect that the right hon. Gentleman the Minister of Health nodded in warm agreement. I little thought that this subject would be raised not from this side but from the benches opposite.
The speeches we have heard so far have shown the utter impossibility of making satisfactory by a series of Regulations and exemptions provisions which, by their nature, are not satisfactory in themselves. When referring to the Regulations, the right hon. Gentleman said with extraordinary frankness that they might look a little complicated. He went on to explain the vast number of exemptions which would be made and he hinted that there would be further exemptions and even different degrees of exemption. I have not considered his recent statement as carefully as I might, but I gather that we are to have virtually a series of graduated prescription charges for a series of graduated illnesses.
We have listened to speeches about tuberculosis and pneumoconiosis. I assure the House that if one tries to get sense into something of this kind by defining medical conditions in this sort of way and by segregating them—by saying that this condition is worthy of being exempted while that condition is not quite worthy of exemption and will be only half exempted—one will find oneself in a lot of difficulty.

The Secretary of State for Wales (Mr. George Thomas): Is the hon. Gentleman making nothing of the fact that old-age pensioners and the categories to which my right hon. Friend referred are indeed exempted?

Dr. Winstanley: I accept that. I am sure that the right hon. Gentleman will, equally, agree that there are many people who are deserving of exemption in addition to old-age pensioners. The Minister of Health accepted that. I am glad that old-age pensioners have been included and I wish that a more realistic age limit for women, at 60, would be introduced because that would be more rational, but I want to concentrate upon why this exercise is being undertaken at all. Clearly it is not designed to raise money. It has been made clear that the kind of money that will be raised is not the kind of money that will make any difference. It will not raise money for the Health Service. If that were the purpose of the exercise one might consider it in a different light. It is designed, one gathers, to in some way reduce pressure on demand at home by seeing that a few people, those who need prescriptions, have less to spend at home.
Consider the possible effects of this. I have said many times that there is a possible argument for introducing a charge for the use of the service. I do not agree with this argument, but it is at least tenable. It seems, however, that if one is to introduce a charge for the use of the Service, it is utterly illogical to pick on something almost accidental like the need for prescription or the number of items on it. If one must make a contribution, why not base it on the use one makes of the Service? A prescription charge makes no assessment of that kind. The patient who goes to the doctor for advice perhaps takes half an hour of the doctor's time but does not necessarily have to have a prescription.
If he merely needs advice, he will pay nothing at all. A person who goes to the doctor may have to have medicines, tablets, or ointments and may need a prescription with two or three items on it and yet take only two minutes of the doctor's time. That patient will pay 7s. 6d. A patient with pneumonia at home may have to pay up to —1 for prescriptions whereas a patient with pneumonia in hospital not only gets his prescriptions free but gets his food free, his laundry free and everything else free.
It is utterly illogical. Why should there be a bigger charge if there are more items? If a person's illness is one of those unfortunate kinds of illness which needs the prescription of different kinds of tablets rather than one single one, why should he be charged double or treble? If we look at it from that point of view, it is illogical.
I would not say that I would support charges of any kind but if we have to make charges, for goodness' sake let us do it logically—charge for the use of the service, or something of that kind.
It may be argued, and it will be argued by some, that the introduction of charges will have some beneficial effect on people's use of the service and make their use of the service more economical. I have practised before the National Health Service began, before 5th July, 1948, in the days when there were white slips for the panel patient, pink for a patient in receipt of National Assistance, none for people paying for their dependants. I was in a position to judge its effects on people requiring all sorts of treatment, and how they took it. Did they use

the service uneconomically because they got it for nothing? Similarly, when the health service prescription charges were introduced I was in a position to judge how it affected me as a doctor prescribing and how it affected my colleagues and the pharmacists and how it affected patients.
Let us consider the patients. There is a general feeling that somehow many people who use the health service ought to be discouraged. I accept that there are people who waste the resources of the National Health Service. These, on the whole, are inadequate people who probably need support and go to the doctor with the slightest problem. They are people who need to be assisted, they are people inadequate in many ways; they need education, instruction or support, but their waste of the service would not be discouraged by charges. If there were charges they would still go to the doctor, even if they could not pay.

Mr. Molloy: The hon. Member is talking of the genuinely inadequate, but would he not agree that those who try to cash in on the inadequacy of some people who use the service in this way are themselves inadequate?

Dr. Winstanley: Let us deal with the matters before us rather than with polemics of that kind. I am sorry that I cannot follow the hon. Gentleman.
Next comes the hypochondriac who wastes her doctor's time. My experience is that the hypochondriac is often a person with a social conscience and feels a little bit reluctant about taking up the doctor's time when it is free to him or her, but introduce charges and she thinks it is cheap at half the price and the tendency is for that person to use the service even more.
What is the effect on the doctor? The doctor immediately tries to save money for his patient by making out prescriptions for larger amounts. I did it. My colleagues did it, and my colleagues will do it again. The pharmacist will make up a blunderbuss preparation and instead of there being three different substances or three kinds of tablets the pharmaceutical industry will roll the three tablets into one for one charge. This had an undesirable effect on the drug industry because it encouraged poly-pharmacy, the



production of mixed preparations of this kind designed purely to escape this tax.
I come next to the effect on pharmacists. People went to pharmacists with prescriptions which the pharmacist had every reason to believe to be necessary, for antibiotics and so on, and said that they did not have the money. The pharmacist issued the prescription and sometimes got the money and sometimes did not. There were others who took in prescriptions which it was clear from their nature had been issued for something important, but which had not been presented for several days after the issue. In other words, people delayed receiving treatment purely for economic reasons.
I have gone on long enough and several hon. Members wish to speak. [HON. MEMBERS: "Go on; it is very good."] I believe that it is perfectly possible for us to provide an efficient, humane and fully comprehensive Health Service entirely without the use of charges. Perhaps we shall have to make some modifications and perhaps we shall have to make better use of some of our present resources, but we can do that and it is not necessary to introduce charges as any kind of penalty, and if they are not as a penalty, they are not for anything.
I assure the right hon. Gentleman that this is a Tory policy. I am not here to campaign for the return of the Tories, but if we are to have Tory policies, one can make out a good case for having Tories to carry them out—at least they have had plenty of practice. The prescription charge scheme which they introduced was at least realistic, and sensible and one could see what it was. It was honest and straightforward and, although I did not agree with it, I thought that it was at least understandable. This scheme is a mess, and I hope that the Prayer succeeds.

9.33 p.m.

Dr. M. S. Miller: It is a formidable task to speak in the debate after the hon. Member for Cheadle (Dr. Winstanley). It seems that I am often accorded the honour of following him, and on most occasions I find myself almost completely in agreement with him. This evening, I agree with his principle, but some of the points he made require a heart-to-heart discussion with him.
It is easy to pass off people who frequent doctors' surgeries as inadequate, and they probably are, but their inadequacy costs the country a great deal of money.

Dr. Shirley Summerskill: Oh!

Dr. Miller: One can make all kinds of expressions of horror, but that is the case. I should have preferred these Regulations not to have been made. When the idea was first put forward, I thought that it should not be considered, because the amount of money involved was paltry and not worth the effort. Regretfully, I have concluded that we have to do a considerable reshaping, not only of the policy of the National Health Service, but also the policy of the social services generally. I regret, however, that this debate on prescription charges takes place in isolation.
The Health Service needs more and not less money to be spent on it. That is something which we must all recognise. Although last year about —1,500 million was spent on the Service, it was not enough. But it is interesting to note that the Beveridge Committee of 1944 estimated the annual cost of the Health Service to be —170 million. It said that, as it gradually improved the health of the nation, its benefits would offset the increasing costs. As it transpired, the cost of the Service in 1952 was —400 million. By 1960 it had risen to —726 million. The cost now is about —1,500 million a year. Yet I say that more money must be spent on it. The question is: from where is the money to come?

Mr. Speaker: Order. A lot of hon. Members wish to speak. The hon. Gentleman must address himself to the Regulations.

Dr. Miller: I am sorry, Mr. Speaker. I thought that I was putting forward a case for imposing prescription charges which would raise a certain amount of money, but indicating that it was only part of the problem. I will bow to your Ruling, Mr. Speaker.
The Service requires the expenditure of another —200 or —250 million. It is true that my right hon. Friend is asking for only —25 million to be raised. It is


not a tremendous sum. The main point which concerns me is not that the Service should be absolutely free at the time of use but that it should provide the best facilities and the best medical treatment possible. Our Health Service does not provide the best medical treatment.
I wish to draw attention to the expenditure of some countries. In Sweden, for example, only one-third of general Government expenditure—

Mr. Speaker: Order. With respect, we are not debating the National Health Service in general. We are praying against or for Regulations which introduce certain prescription charges. The hon. Gentleman must link his remarks to the Regulations.

Dr. Miller: I am sorry, Mr. Speaker. I again bow to your Ruling.
As my hon. Friends have indicated, I feel that it should not be necessary to apply these Regulations, but as we are faced with difficulties and despite the fact that the amount which it is estimated will be raised by prescription charges, —25 million, is relatively small, I must support the Government this evening.

9.38 p.m.

Mr. Maurice Macmillan: The hon. Member for Glasgow, Kelvin-grove (Dr. Miller) has pointed to the Minister's dilemma, but I hope that he will forgive me if I do not take up his argument. I wish to intervene as briefly as possible, as many hon. Members wish to speak.
I had some criticisms of detail of the Regulations and exemptions and of the mechanism and administration of the Regulations, but most of them have been made by hon. Members on both sides of the House. Unlike the Minister's hon. Friends, I am not so strongly against them in principle, but I criticise him not only for a lack of consistency with his own past, which might be an unfortunate necessity, but for the Jack of consistency which he showed in his remarks.
The right hon. Gentleman said that the only reason for bringing in the charges was a regrettable necessity, thereby implying that there was an exceptional reason in the present situation for doing so. He went on to admit that a regrettable necessity of this kind has been

facing successive Governments, both Socialist and Conservative. I will try to show why we on this side of the House do not share the view of his hon. Friends. At least we have a tribute from the Liberal Party that, whatever the fault of our systems, they were realistic, truthful, honest and efficient. I agree with the hon. Member for Cheadle (Dr. Winstanley) that this is not a characteristic of this form of Regulation.
In our view this is a matter primarily not of principle, but of priority, and this is why we are more consistent than the Minister. It is only by accepting this and by accepting implications that go further than prescription charges that one can get better value for money and make the Health Service more effective in action.
The hon. Member for Willesden (Mr. Pavitt), in a very telling speech, set out an extremely logical and defensible point of view. I do not agree altogether with his premise or his argument, but I take his point. He is setting out a consistent policy. Until recently, I thought that the Minister more or less shared that view. As a Tory, I welcome his late conversion and that of some at least of the hon. Gentlemen opposite.
We remember that the present Prime Minister resigned over the issue of false teeth and spectacles, and the Minister himself has been adamant about the damage which would be caused to the Health Service by the imposition of charges. We on this side say that we would prefer him to have come to his new conclusions earlier so that he could have saved more money than he will save now.
I admit that any Minister of Health is facing a genuine dilemma and, contrary to what the Minister suggested to the House this evening, in our view it is a permanent dilemma which faces the Minister of Health and has faced him from the start of the Health Service. I am inclined to take the view of the hon. Member for Kelvingrove that what concerns us is not so much to see that the Health Service is free in every aspect at point of use as to see that it is effective.
As the Minister said, the Tory Government were faced with this dilemma in 1956. The late Mr. Gaitskell faced it in his Budget speech in 1951 and found it necessary to impose charges on the Health Service. According to the New Statesman


of 24th March, 1961, the right hon. Gentleman the present Prime Minister, 10 years later in March 1961, said:
The first task on the Health Service will be to recreate the free service established by Aneurin Bevan. The repeal of the charges is likely to cost —45 million a year, but this is not all. Year by year the pace is becoming stronger for taking the Health Service and its contribution under the general Exchequer system.
We have now reached a different point, and the Minister has implied that, for some reason, this is no longer possible. But he is deluding himself if he assumes that it will ever be possible under his Government, because we are coming near the limit to which taxation can be increased to finance the Health Ser-vice—

Mr. Winnick: Rubbish.

Mr. Macmillan: The hon. Member does not agree. In their booklet, "Socialism and Affluence", which was published in May last year, Professors Titmuss, Abel Smith and Townsend took the view that taxation can be increased and that the risk to economic growth is not significant. On the other hand, in May, 1967, the present Chancellor of the Exchequer said that we cannot be indifferent to the disincentive effect which very high taxation on earned income might have—

Mr. Speaker: Order. The hon. Gentleman must not broaden the canvas. We are discussing a Prayer. He must keep to it.

Mr. Macmillan: If hon. Gentlemen opposite will allow me to develop my argument, I think that it will be seen to be in order.
The Chancellor was arguing that the need for economic growth cannot be avoided and that, only by economic growth, can social progress and social expenditure be financed. The Lord President of the Council, too—

Mr. Speaker: Order. The hon. Gentleman must take note of what Mr. Speaker says. Debate on a Prayer is limited to the Prayer. We cannot discuss the whole theory of economics and taxation.

Mr. Macmillan: I bow to your Ruling, Mr. Speaker. I was seeking merely to show that neither economic growth nor

high taxation is in itself enough to provide an adequate and expanding Health Service. I would agree with the hon. Gentleman—

Mr. Speaker: Order. The hon. Gentleman must take note of what I have said. We are discussing a Prayer against a Statutory Instrument.

Mr. Winnick: The hon. Gentleman should join the hon. Member for Tyne-mouth (Dame Irene Ward).

Mr. Macmillan: I will turn, then, to some of the regulations and exemptions. First, there are a number of exempted people categorised by who they are. We must press the Under-Secretary of State to tell us why women have been exempted only after the age of 65. Surely the logic of any exemption by age is a drop in income on retirement, in which event the position of women should be based entirely on their retirement.
I am not certain of the logic of exempting parents from paying prescription charges for all their children of any age. It seems to me that the age of 15 is arbitrary and needs further explanation.
Then there has been no mention of the position of hospital patients who are co-operating in various forms of experiments with hospitals and require prescriptions. At the moment, there is no method for exempting them from paying prescription charges when they have their prescriptions filled by outside chemists.
The second group of people set out in the regulations is the category known as the chronic sick. Obviously, the grave disadvantage of any regulation of this type is the extremely difficult task of definition. The Minister has taken two bites at this cherry. He has set out to define the chronic sick first by the nature of the disease and, second, by the degree of disability.
I do not think I need add to the questions which have been asked as to why various diseases have or have not been included in the Minister's list. We should have a little further explanation as to how what the hon. Member for Willesden, West called the graduated prescription charge will work in practice. I emphasise one public health aspect which is foolish for many reasons, including that of the discouraging tuberculosis patients from taking necessary drugs at a stage when


we are so near total elimination of this disease. I am also not sure of the logic about heart patients.
The other definition which the Minister gave was those whose disability is sufficient to prevent them leaving home unaided. The Under-Secretary, when replying to the debate, might give us more idea of the principles involved in this, because it seems that the Minister is actively discouraging those who may require a considerable degree of medication in order to be able to go on working and who are perfectly well and able to leave home by themselves provided they continue the treatment. Some forms of mental patient should be included in this.
I hope that the hon. Gentleman will be able to reassure us on some of the matters about costs raised by my hon. Friend the Member for Maldon (Mr. Brian Harrison), who has great knowledge of hospital administration. The running costs, according to the Minister, were, I think, set out at —250,000. He was not specific about the initial cost or the future cost when he will bring the more permanent scheme into operation.
I hope that we can be reassured that this will not inhibit in any way the ideas that the Minister may be bringing forward as to plans based on various Reports, such as the Seebohm Report and the Green Paper. This is a piecemeal approach to the problem of Health Service finance. I think that the House would like to be reassured that this piecemeal approach will not inhibit future action.
I hope that the Minister can provide a little more justification for a scheme which seems to have all the disadvantages of which a Tory scheme could be accused, but none of the elements of simplicity or efficiency and of a plan which the Minister must have produced with great reluctance knowing in his heart that he is as much against it in principle as those of his hon. Friends who keep attacking it in practice.

9.54 p.m.

Dr. John Dunwoody: I shall not pursue the points raised in the rather wide-ranging speech of the hon. Member for Farnham (Mr. Maurice Macmillan), but I find the crocodile tears which have been shed by hon. Members opposite about prescription charges come ill from a party which

fought the last General Election precisely on the introduction of prescription charges again.
I rise tonight more in sorrow than in anger, in sorrow that it should ever have become necessary to argue in this House of Commons about prescription charges with my friends and political colleagues. This sorrow is all the more strongly felt because our record as a Government has been so very good in the National Health Service during the last thre and a half years, in which we have seen dramatic changes, a considerable increase in investment in the Service, schemes for hospital building getting off the ground, new hospitals being built and a new general practitioner pay structure; and when all the resignations which were in the hands of the Minister not so long ago have been forgotten.
I believe that my right hon. Friend the present Minister is outstanding and excellent. I say this having worked in the Health Service under a large number of Ministers of Health of the party opposite. But to tax the sick, which is what we are talking about tonight, is, and always will be, socially unjust. The present scheme is financially questionable, and prescription charges are medically damaging and potentially dangerous. The whole exercise in which we are engaging is politically inept.
I turn first to my political objections to the Regulations. The National Health Service is not a sacred cow to me. It is a practical example of what Socialism is all about; it is an example of Socialism at work in the community. The basic principle of the Service is that we pay for our medical treatment when we are fit, when we are working, when we can afford to pay, and do not pay for it when we are off work, when we are sick, when we are retired.
It is illuminating to remind ourselves of what we said in our party Health Service document, "Members One of Another" issued just before the 1964 General Election. We said:
Labour has always stood for the principle that the National Health Service should be paid for by all of us when we are well, and should be available without charge to all of us when we need its help.
That is just as true today as it was then. The document continues:
Moreover the charges "—


It is referring to the prescription charges then in force under a Conservative Government—
 are the thin end of a dangerous wedge, and already some Conservatives are advocating an extension of charges as a way of ' disciplining' the public and relieving the taxpayer. We reaffirm the pledge, repeatedly given, that, in order to restore a free Health Service we shall abolish all charges…
That pledge was important and meaningful. It was one of the reasons why we won the 1964 General Election. We won it by a very small majority, and every part of our manifesto was of great significance. After we had won the election we kept the promise and in February, 1965, abolished prescription charges. I was then in general practice and could see the consequences of doing this. It provided considerable help to certain sections of the community for whom the Health Service is vital. We must be concerned that we are doing more than failing to keep a political promise; we are breaking a pledge that we have already fulfilled.
I have certain objections to the economic arguments for the reintroduc-tion of the charges. The only real argument put forward for the charges in the debate is that it is economically necessary to introduce them. Figures of £50 million have been quoted several times as the revenue from charges, if we have only the sort of exemptions the Conservatives had, or £25 million with the widely-based exemptions proposed in these and subsequent Regulations.
I question these figures because of some Answers to Questions I have put to the Minister in recent months. He has told me that in the last convenient 12-month period up to March, 1967, if we had had a charge of 2s. 6d. on every prescription issued we should have raised £34 million, not the £50 million that has been quoted. But we know from past experience that when charges are introduced the number of prescriptions falls. The total value does not, because all the doctors hand out larger quantities. One can imagine that the fall would be perhaps 10 per cent., bringing the figure down to £30 million.
The Minister said today, and we have heard this before in answer to Questions, that perhaps about 45 per cent, of the

community will be exempted from charges, but we are also told that this 45 per cent, of the community will make up only about 50 per cent, of surgery attendances and prescription issues. I cannot accept this figure. I hope that when my hon. Friend answers the debate he will give some justification for this oft-repeated claim.
I have spoken to a number of general practitioners. I asked them to keep records of the people attending their surgeries. In very case those who are to be exempted comprised two-thirds or more of the patients. If two-thirds are to be exempted, the figure of £30 million comes down to about £10 million. One can add another 10 per cent, or so for Scotland. But the figure is less than some which have been quoted.
In the Budget it was necessary to raise taxation by £900 million. By putting a few pence on cigarettes and tobacco, the Chancellor raised £30 million; by an increase of a few pence on spirits and wines he raised £15 million; the betting and gaming duty increase was £30 million. Here, however, we are talking in terms of a figure of £10 million or £11 million. If we had put a penny on the price of a pint of beer we would have got nearly £40 million extra revenue. Surely there should have been higher priorities for additional revenue.
I fall back on my experience as a family doctor. I know that, when we had the charges before, a small proportion of patients as a direct result were denied medical treatment. The number is not large, although it is fairly regular and comprises constant attenders at the surgeries. They are, in particular, people with low incomes, others who are not particularly adequate and people who are not perhaps problem families but who are bordering on being such. They would often come to me for a prescription on Tuesday and keep it until Friday, when their money came in. Sometimes they would take the prescription to the chemist and ask him to pick out which was the most important item so that they would have to pay only one charge. This sort of thing is one of the serious social and medical consequences of prescription charges.
Another aspect I am unhappy about is that the charges fall particularly heavily


on certain parts of the country, particularly in those areas where the average income is low. The part of the country I represent has the lowest average wage of any county in England, which means that the charges will be a greater burden on the people there than on those in the prosperous areas of the Midlands and the South-East. The charges will fall particularly heavily on those parts of the country like colliery areas and South Wales, where the incidence of illness is much higher than elsewhere. If we believe in regional policies, we should also take these considerations into account.
I come now to the medical objections. First, there is the overriding medical judgment that it is to me repugnant to be taxing the sick, but I want to look at some of the exemptions proposed and to be critical in certain cases. There is the exemption of youngsters under 15. Why under 15? Why does it not apply to those in full-time education? Why not exempt the 16 or 17 year old who is still at school and not earning?
There is to be exemption for those over 65 years of age, but what about the women pensioners between the ages of 60 and 65? These are a group who are regular attenders at surgery and who often need medical treatment at an early stage. The war disabled are to be exempted. That is obviously right. But what about the industrially disabled and the other disabled? Some of them will slip through.
There are endless anomalies to be found in any system of exemptions, however comprehensive it may appear to be. The bulk of chronic illnesses will not be covered. It may be that the season ticket system will do something to help, but many people in the country are very worried about this measure, and justifiably so. I have here a letter representative of many I have received from people in my area. The man asks what his position is to be and says:
I suffer from bronchial asthma and have just resumed work after being home for 6 months … I have only worked four months since April of last year. I have to see my doctor at fortnightly intervals, and after seeing him today he informed me that he cannot see where I can be exempt.
I am now taking four different tablets … two different medicines when required and also using inhalers. All these drugs have been prescribed by the consulting physician….

If I have to pay for these, it is going to cost me quite a lot of money … I am a family man with three children and am employed by British Rail … I could I suppose, if I have to pay these charges, be as well off in money matters not working at all".
This is the position in which many people will be put. It may be that we shall be able to help some of them by going through the procedure of getting supplementary benefit for them and thus giving them some relief. But it will be complex and difficult and many of them will not be helped. These are people who are suffering from bronchitis, asthma, emphysema, arthritis and psychiatric conditions. The psychiatric cases concern me particularly.
I have received a letter from a consultant psychiatrist who is very concerned about this matter. He brings up the question of schizophrenic patients. One of the most dramatic developments of the last 20 or 30 years has been our ability to treat and control schizophrenics with modern drugs. Many of these patients are not particularly co-operative and will use any excuse to avoid getting their tablets and continuing their treatment. This consultant psychiatrist writes:
As I am sure you will appreciate, these patients often have little or no insight into their condition and into the necessity for their taking medication…. Many of them … often hold down poorly paid jobs. If they have to pay something for their medication or, indeed, submit to what may seem to us an uncomplicated procedure, my fear is that their disinclination to bother with taking drugs could cause a number of relapses and could well increase the number of admissions and thereby raise N.H.S. costs rather than reduce them … 
This is a widespread fear among psychiatrists. It is a fear which is strongly held by many people working in mental health.
Another group of patients who will not be given the sort of relief which they should have are those with malignant diseases. In this country, 100,000 people or more die from cancer every year. Many of them are aged under 65. Many of them are not the sort of people to whom one can say, "You will be chronic-ally sick now". One has to try to buoy them up and keep them going. Sometimes one cannot tell them the truth. They will not be able to get exemption even when all the new schemes are in operation because too often the doctor


has to pretend that this is a temporary illness and they will be on their feet next week. This is a large and unfortunately increasing group of patients who will not be helped.
I welcome the fact that there will be additional exemptions in months ahead as a result of later Regulations, but I appeal to my right hon. Friend to try to introduce them as soon as possible because there will be many anomalies from 10th June if these Regulations are passed. Millions of pounds will be spent by people who subsequently will be exempted when the latest scheme for exemption is introduced. It is urgent that the latest scheme for relief should be introduced fairly soon.
It is no good blaming the doctors if we have not been able to devise a satisfactory scheme, because it is not the doctors' job to decide who will and who will not pay tax. Governments have the job of deciding taxation policy. The doctor's job is to get the patient fit and well. If the doctors had not done what they have done they would have run a real risk of damaging the doctor-patient relationship, which will be damaged to a certain extent by the introduction of charges.
This is a sad day. This is a serious blow to the National Health Service, but not a fatal one. Most of those who go into the Lobby in support of prescription charges will know in their hearts that they are wrong. The real supporters of charges are the people on the outside who are not here tonight. We may lose tonight, but this fight will go on until we again have a Health Service freely available to all in their time of need.

10.4 p.m.

Mr. T. L. Iremonger: The Minister said that the Undersecretary of State for Scotland would be winding up the debate and would deal with points which might have been raised after he had sat down. I hope that the hon. Gentleman will not confine himself to Scotland, but will answer in respect of other general points. Would the hon. Gentleman amplify what the Minister said about psychiatric patients coming in under the season ticket system which is being introduced in legislation now on its way through Parliament.
Will the Minister explain whether this means patients suffering from schizophrenia? There are two of the largest and finest hospitals which treat patients under the Mental Health Act in my constituency. I have had a letter from the the assistant physician superintendent of one which I ought to bring to the Minister's attention. He asks me whether it would be possible
to ensure that, if prescription charges are introduced, patients suffering from schizophrenic illness may be included amongst the exempted classes.
He also says:
There are a very large number of such patients who are able to remain reasonably well so long as they have their maintenance treatment. But it is very often difficult to persuade such patients that they continue treatment and I foresee that if they have to pay 5s. to 7s. 6d., or more, each time they go to the doctor to get a repeat prescription, they will be even less likely to continue maintenance than they are at present and many more will need to be readmitted to hospital.
These readmissions into mental hospitals will be of a class of patient which, at the moment, it is possible to keep outside much more than it has been in the past, a class of patient which accounts for a very high proportion of beds in hospitals that treat mental illness and a high proportion of the total number of beds in the National Health Service as a whole.
The acting physician superintendent goes on:
Maintenance treatment of this kind needs to go on for years … and t seems to me that they should qualify just as much as epileptics requiring continuous anti-convulsant therapy, or people suffering from endocrine disorders 
That seems to be a very powerful and important case and I hope that it will be convenient, on these Regulations, for some reassurance to be given to the House.
In general, I should not wish to ingratiate myself with hon. Gentlemen opposite. Seeing them ranged there in all their strength and passion it would be cowardly of me not to say bluntly that I am in favour of prescription charges. I have no doubt that in the eyes of hon. Gentlemen opposite I am wrong. Having sat here as long as I have tonight, and having sat on the other side of the House on earlier occasions, I can say that I understand pretty well


what hon. Gentlemen opposite feel. I see the force of their case, but I think that they are wrong.
I disagree also with the hon. Member for Cheadle (Dr. Winstanley) who, in a very moving and telling speech—he said that if we are to introduce prescription charges we should do it the way the Tories did; that is better. My hon. Friend the Member for Farnham (Mr. Maurice Macmillan), who spoke from our Front Bench, said the same. He thought that our way was better. I do not think so. I think that the Minister's way is better. I am his only friend here tonight [HON. MEMBERS: "Oh."] It is about the only encouragement that the right hon. Gentleman has been given tonight. I am sorry to give him such devastating embarrassment as to be his only supporter.
Although I know that he is not in favour of prescription charges, I am. What is more, I think that if we are to do this, we should do it in his way. I do not see why we should not have prescription charges, and then make exemptions in the way being made in these Regulations and also in the season ticket method we hope to have shortly. The merit of doing it in this way is that one can try to make the exemptions with some precision, try to get it right and get the best medical advice about the exemptions which are most necessary. I think that is the sense of paragraph 7 of the Regulations. I am sorry that it does not include schizophrenic patients, but I hope that other provisions will be made for them and I ask for an assurance of that.

10.15 p.m.

Dr. David Owen: This is a sad day for hon. Members on this side of the House, and I do not take part in the debate with any relish. In many ways it would have been better if, on my pairing day, I had taken up my pair and ignored the challenge which we face.
I do not take the speeches of hon. Gentlemen opposite very seriously. Their views on the Health Service are known to us all. They would like to see a large and expanding private sector. They would like to see, and at one time openly supported, free medicines for people in the private sector.
We on this side of the House have to face seriously the problem of what is happening to the Health Service. I have listened with great care to the speeches of my hon. Friends. I agree with the arguments advanced by those who are opposed to these Regulations. I found very little with which to disagree in the speech of my hon. Friend the Member for Falmouth and Camborne (Dr. John Dunwoody), but I disagree with his conclusion.
I hope that those of my hon. Friends who spend a lot of time like myself urging high rates of public expenditure, and trying to get something done about poverty, will respect my feelings. I speak as one who spends some time on the finance committee of a large hospital group. I cannot disguise what an appalling lesson this has been to someone who has worked in the Health Service, signed prescriptions, signed people up for expensive treatment, and also worked for short periods in general practice.
I am appalled at the challenge of financial stringencies which the Health Service is facing. We must recognise the problem. We cannot judge this issue without first looking at the Health Service as it is. It is under-capitalised, and underfinanced in comparison even with the American system. In 1962 they spent 5·5 per cent. of their gross national product on their health service, while we spent only 4 per cent. on ours. Theirs is largely a privately-financed health service.
We have to take into account also the fact that during the last four years this Government have increased the amount put into the Health Service by 45 per cent. We are now spending 4·85 per cent. of our gross national product on health, and this is a higher percentage than ever before. That is the background to the debate.
We have to remember, too, the courageous decisions which the Government set out in January in their expenditure review and in the Budget. During the National Plan period we have maintained the 4·25 per cent. growth in public expenditure which was envisaged on the basis of a 4 per cent. growth rate in the economy. We have, therefore, maintained faith with our principles. We have maintained high rates of public expenditure and in consequence people are now asked


to take a 1 per cent. cut in their collective living standards. We on this side of the House know how unpopular that is, and how difficult it will be to carry out.
We cannot consider these prescription charges without looking at the January decisions which racked us, namely, not to raise the school-leaving age, to raise charges for school meals, school milk—

Mr. Speaker: Order. We must look at these Regulations.

Dr. Owen: I respectfully agree with you, Mr. Speaker, but we cannot, in all honesty, look at them in isolation. It is said that the £25 million which it is intended to save on prescription charges is not much money. In the circumstances in which we find ourselves, I think that it is a lot of money, and it is no good some of my hon. Friends saying that it is not.
We have to put ourselves in the Minister's place. He was told, rightly or wrongly—and, in view of the cuts which were made in other areas like education, I think rightly—that he had to make savings in the National Health Service in the first year of £29 million, and £31 million in the next year. He therefore looked at the Health Service. I put myself in the Minister's position and I cannot but come to the same conclusion, that he faced a direct choice in getting a saving in this year of either cutting the hospital building programme or raising prescription charges. Faced with that choice, however regrettable and whatever the objections to the prescription charges, all of which I respect, I think that he was right.
Of course prescription charges are a tax on sickness. I would not deny that. I fought elections on that slogan and I stand by it, but inadequate provision in the Health Service is equally a tax on sickness. We cannot go on asking people to accept a free Health Service which does not make adequate provision. One and a half million people have opted out of the Health Service and are now covered by private insurance. This number is increasing and, if it does much more there will be two standards. I believe in a universal, comprehensive Health Service. That is why we must inject much more money into it and the extra amount which has been put in is a tribute to the

Government in relation to our financial position.
I accept all the objections to prescription charges, and I have some detailed points on the Regulations. I am shattered that it has not been possible, for instance, to make an accommodation for chronic schizophrenics, who are groups of patients on "maintenance therapy" as much as any other categories, and who must be covered by the scheme which my right hon. Friend hopes to introduce, loosely called the "season ticket" scheme.
We have the right to ask for one pledge. This scheme will throw up many anomalies. These exemptions have never been introduced before. This is a quite different prescription charges scheme from the previous one and it would be intolerable if it were administered with Treasury officials breathing down the Minister's neck and saying that the £25 million saving had to be sustained at all costs. Over the next year, he may have to revise these Regulations considerably and he should not be afraid of doing so.
He is asking my hon. Friends and many in the country to take something which goes right against everything which they have ever wanted. We must accept that this is very hard to take for many of our loyal party supporters, but what we must get across is a much more rational attitude to charging in the Health Service. I believe that it would be possible to introduce a system of charging which is not a tax on sickness, and in that sense I find prescription charges much harder to take. The Minister should look at a system of charging for the food of those in hospital, which could raise exactly the same amount—[HON. MEMBERS: "Oh."] —my hon. Friends may not like that, but it is not a tax on sickness and could raise money. Where else will this saving come from?

Mrs. Anne Kerr: Would my hon. Friend not accept that there is possibly an absolutely different method of running our national finances than the one which the present Government are adopting? Would he not therefore accept that it is unnecessary to tax sickness and also that one cannot charge people who are already sick when they are in hospital?

Dr. Owen: My hon. Friend must try to follow the argument. Of course I


accept those criticisms, but they must be viewed against the background of a Budget which has taken out over £900 million in general taxation. This is the situation. We must remember too that 75 per cent. of those interviewed in a recent public opinion poll said that they would accept prescription charges, provided that there was exemption for lower paid workers. This may not be entirely representative, but at least it shows that there is a widespread acceptance in the country of the principle of charging within the National Health Service. I appreciate that this is objectionable to a great many of my hon. Friends. I respect their views, but they must consider the alternatives.
We have made cuts totalling £5 million in the community health services and I believe that these cuts are far worse in their effect on the old than prescription charges, from which most of them are exempt. By stopping health centre building and services for old people—one can think of simple things like chiropody and other services provided by many local authorities—great hardship will be caused, and this must be faced.
I appreciate that many of my hon. Friends will find what I have said difficult to accept. I have said it because somebody on these benches had to make these remarks and I believe that the Govern-

ment have made the right choice. We are facing the fact that the Health Service must have more money. Under this Government we have rightly maintained high rates of public expenditure and, in the circumstances, I believe that we have made the right decision. We have made a massive shift in resources to correct public squalor, one of the main reasons why we were elected in 1964. It is all very well for hon. Members to say that, I am just being loyal to the Government —[Interruption]—but my experience is that loyalty to this Government does not carry much reward. It is much easier not to offend people and while I respect the differing views which have been expressed—

Dr. Summerskill: On a point of order. When an hon. Gentleman opposite was making comments which were totally irrelevant to the Regulations he was called to order. Should not the same be done to my hon. Friend?

Mr. Speaker: I am grateful to the hon. Lady for assisting Mr. Speaker in his duties. Dr. Owen.

Dr. Owen: This has been a difficult speech for me to make and I hope that my hon. Friends will accept that I have made it with sincerity, just as I am sure that others have been sincere in the views that they have expressed.

10.28 p.m.

Mr. Tim Fortescue: I was grateful to the hon. Member for Plymouth, Sutton (Dr. David Owen) for reminding the House that the Conservative Party fought the last election on the basis of restoring prescription charges. Had he not mentioned that fact, I would have done so. The hon. Gentleman made a powerful speech and I agreed with almost every word of it. However, as many hon. Members still hope to take part in the debate, I will not comment on many of the points he made.
I have been trying to understand the basis on which the Minister has made exemptions to these charges. In Regulation 7(1) there are six categories of exemptions—two on the ground of age, under 15 and over 65; three on the ground of conditions, pregnancy, chronic sickness and war disablement; and one on the ground of need, which speaks for itself.
Nobody will quarrel with the exemption on the ground of need, but in respect of the three on the ground of condition—I admit that nobody will quarrel with the war disablement exemption— why have the Government not included industrial injury disablement as well? 1 should like to see that exemption made.
Hon. Members with more knowledge than I have spoken at length on the need to extend the chronic sickness exemptions. The Minister explained that he has not been able to do this because the doctors do not agree. This is a difficult point to accept because one must ask who is running the country, the doctors or the Government?
As for the exemption for pregnancy, one cannot argue against pregnant women being exempted, but is it necessary for them to remain exempt for one year after the birth of the child? I suggest that this is not in line with modern medical thinking, although I stand to be corrected. I have seen many young women a year after their babies have been born and some of them have been pregnant again and looking well.

Dr. Winstanley: If such a woman is looking well and is well, she would not need a prescription.

Mr. Fortescue: Under the Regulations she is exempted for a year after the baby is bora. She is, therefore, exempt whatever the condition of her health and the exemption is not solely in respect of the aftermath of the pregnancy. The fourth exemption is on the ground of age. There has been extensive comment on the exemption of those over 65. Why is it over 65 when the pensionable age for women is 60? This is something which must be put right very soon.
There is, finally, the exemption for children under 15. With this I disagree almost entirely. How can exempting all children under the age of 15 be justified? Many hon. Members, many of those in the Chamber tonight, have children under the age of 15. How can they happily see their children getting their prescriptions free when the ailing wife of a man earning £10 or £12 a week has to pay for her prescriptions? How in all conscience can they allow that? How can that be in any way in accordance with Socialist theory, or that of the House of Commons? While giving the Minister my general support for these prescriptions charges, I beg him to look again at these categories, because hardly any are satisfactory from the point of view of logic or compassion.

10.31 p.m.

Mr. Arthur Blenkinsop: I completely accept the sincerity of my hon. Friend the Member for Plymouth, Sutton (Dr. David Owen) and I hope that he will equally accept the sincerity of many of us who believe that we are concerned with a major principle. As one who played some part in earlier debates on this subject and who was involved with some of those whom we no longer have with us, particularly Nye Bevan, in the development of the National Health Service, I must say something on this subject, if only briefly.
I cannot comprehend the attitude of the hon. Member for Cheadle (Dr. Winstanley), that if we are to have charges, we should have them in the vicious form in which they were introduced by the Tories. I deeply wish that we were not to have charges, but, if we are, I prefer to exempt as many categories as possible to the system which we had before of paying charges and reclaiming them,


a system which was both appallingly wasteful administratively and a way of imposing hardships and difficulties on individuals. The more we can widen the categories for exemption, the more pleased I am, and the more ridiculous becomes the scheme, because the more the scope of exemptions is widened, the smaller is the revenue and the greater the worthlessness of this proposal.
To me and to many of my hon. Friends this is putting us back where we started. Many of us regard this proposal as leading almost inevitably to the position taken up by the right hon. Member for Wolverhampton, South-West (Mr. Powell)—I hope that I have got the right part of Wolverhampton; I should not like to offend my hon. Friend the Member for Wolverhampton, North-East (Mrs. Renée Short). Consistently over the years, the right hon. Member for Wolverhampton, South-West and the right hon. Member for Enfield, West (Mr. Iain Macleod) have made a case for the introduction of charges throughout the various public services.
On the contrary, many of us hold the view, equally strongly, that it is vital to our concept of the development of social services that they should be free at the time of need, especially when we are concerned with services vital to the whole community, when they are services in which the element of choice is not involved. This is not a matter of choice; it is a matter of necessity for the community; these are services for the community. Therefore, anything which imposes a charge at this level is a danger. It has been the hope of many of us that services of this character should not be diminished but should be greatly increased in proportion and that the level of commercial operations in our community should be to that extent diminished This is the way in which we saw the new approach to our society developing.
What has been so important to many people is that the principle has been in sharp conflict with our commercial society—and this is something which young people are beginning to recognise more fully at the present time. Therefore, there is danger if we give up this principle, above all in a service so vital to the whole community as the National Health Service. It is on this principle

that I take issue with the Regulations and it is because of this that I welcome the new extension of exemptions which we can achieve, because that takes us nearer to the principle to which I am attached.
That is why I would certainly not support the attitude of the hon. Member for Cheadle. I am in difficulty this evening because I recognise that anything that harms in any way the position of the Government I support is helpful to hon. Members opposite. I know perfectly well that their alternative is to bring in the whole range of charges, to bring the National Health Service to the market place, which is precisely where they believe it and other services belong. I do not believe that it belongs in the market place and for that reason I cannot support my right hon. Friends tonight.

10.38 p.m.

Mr. Eldon Griffiths: I have listened to the last seven speeches and have heard the two speeches by medical practitioners, both of which impressed me very much. The speech by the hon. Member for Cheadle (Dr. Winstanley) pulverised the Government's case. The speech by the hon. Member for Falmouth and Camborne (Dr. John Dunwoody) similarly demonstrated that the Order is an administrative dog's breakfast.
I make it clear that I am in favour of prescription charges. I support them on principle because I think they are good for the National Health Service, good for the doctors and good for the country. I am sure that hon. Members opposite would prefer hon. Members on this side to say openly and honestly where we stand and I recognise that they stand in precisely the opposite corner.
But the matter before us is the Regulations. I have read them carefully. I do not see how they are going to work with justice. They are creating anomalies. They will bring to hon. Members large numbers of complaints from constituents—"He is getting free medicine and I am not." We are going to have to bombard the right hon. Gentleman with requests for explanations of why inequities and anomalies have been put upon our constituents.
I am in favour of prescription charges but I could not possibly vote in favour


of these Regulations. Indeed, unless the Minister is able to produce in his reply something more convincing, my instinct will be to vote against the Regulations.

10.40 p.m.

Mr. Will Griffiths: The hon. Member for Bury St. Edmunds (Mr. Eldon Griffiths) has been forthright and frank. He reinforced what my hon. Friend the Member for South Shields (Mr. Blenkinsop) said, that there have been hon. Members opposite who for years have frankly said, as the hon. Gentleman did tonight, that they believe in a Health Service with charges. I remember that many years ago a former Minister of Health, the right hon. Member for Enfield, West (Mr. Iain Macleod) said quite clearly that he believed in charges in the National Health Service, not only for financial reasons but on social and ethical grounds.
That has never been the position of hon. Members on this side of the House. It was infinitely tragic to see my right hon. Friend the Minister, who has acted with great distinction in his Department and been a most eloquent advocate of a free National Health Service, making a Tory speech at the dictates of my right hon. Friend the Chancellor of the Exchequer.
My hon. Friend the Member for Plymouth, Sutton (Dr. David Owen) talks, as other Members may, about being loyal to the Government. But what about being loyal to one's electorate? I imagine that every Member on this side of the House, possibly even the Minister himself, boasted to the electorate in March, 1966, of having carried out one important pledge made in 1964—the pledge to abolish prescription charges. I suppose that it did not do my hon. Friend the Member for Sutton any harm either, along with the rest of us.
We are debating Regulations which give expression to an aspect of Government policy on Government expenditure enunciated last January. There has been nothing more depressing for me in the past few months than to hear my colleagues who are Ministers in the Social Security Departments saying, "Well, we all had to have a whip round; we all had to make a contribution." This is

what we have heard repeatedly. It is the ultimate abdication of collective responsibility. This is more depressing than the individual items, because it challenges the validity of assumptions we have all held, namely, that politics is about social priorities.
We have our honestly expressed differences on this. I was in the House when the Labour Party was convulsed on a previous occasion over prescription charges. I had the privilege of being Parliamentary Private Secretary to Aneurin Bevan, and I was one of those who supported him and my right hon. Friend the present Prime Minister when they resigned from the Government in 1951.
Nowadays I hear the Prime Minister talking about sacred cows. If I interpret the phrase correctly, I should have thought that we want the Government almost to recognise some sacred cows, and to preserve them. A free National Health Service has become a principle of Labour Party thinking. I am not prepared to discuss whether or not people can afford to pay prescription charges. I shall not get involved in that, because it is a Tory argument. The argument was settled for this party a long time ago.
Why has the decision been made to impose the charges now? I should have thought that many of my hon. Friends could collectively advance to the Government a series of alternatives which would enable us to escape from the agony we face tonight, even though perhaps they have not quite the academic distinction of some members of the Cabinet. The present Cabinet probably contains more people of academic distinction than any for many years—it is stuffed with economists. I have been a Member of the House at times when the economists have led us, to put it mildly, on the wrong path.
The Minister advanced the argument, "What would you do?" Since he has ventured into this field and asked that, I should like to ask him what criteria were laid down for him when he was coming to these decisions. What have these charges on poor and sick people and people in pain to do with import substitution, export expansion and the saving of foreign exchange? Nearly all the political commentators seemed to suggest at the end of last year that the


economy would collapse at once unless we imposed Health Service charges. Mr. Ian Trethowan made that case in The Times.
I wonder whether my colleagues who were Members in 1951 or who have read about what happened then remember the charges being imposed and the reasons advanced for them. This was the year in which the Labour Government were persuaded to embark on a sudden expansion of their defence programme. The great year of decision was to be 1954. In 1951 we embarked on a hastily conceived expanded defence programme. The budgetary consequences of that rearmament programme were expressed in the form of the first charges on the National Health Service in 1951. The political consequences were the resignations from the Labour Government of the present Prime Minister, Mr. Bevan and Mr. John Freeman. Our party was riven by dissent. A year later the Conservative Party returned to power, and one of the first things that Sir Winston Churchill told the House was that those of us who had argued against the Health Service charges in 1951 because the economic policy was wrong—the "Bevanites", as they called us in those days—were right, but added, characteristically, "but for the wrong reasons."
Many of my hon. Friends have cast doubt on the financial savings which the Government expect to make by imposing prescription charges. My hon. Friend the Member for Falmouth and Camborne made a very persuasive case. When we consider these very complicated Regulations—and here I agree with the hon. Member for Bury St. Edmunds—we realise the intolerable burden which the Government are placing on patients, pharmacists and doctors. They are passing the buck all right.
I have looked at the prescription form. It is an extraordinarily complicated document and is rather difficult to read simply because of the size of the print. This constitutes a barrier to obtaining exemptions. Note of us could hardly look at the form without seizing on some apparent absurdity or anomaly. My hon. Friends and hon. Members opposite have given examples. Let me give three. I understand that there is no appeal machinery. If the Regulations are

passed, why cannot the Supplementary Benefits Appeals Tribunal deal with appeals under Regulation 7(1)(f)? If exemption is refused, will people be given a written statement showing how far above the income limit they are? There has been much talk about the list of chronic diseases. The hon. Lady the Member for Plymouth, Devonport (Dame Joan Vickers) said that in some instances it might be extremely unwise if a patient knew from what he was suffering.
I do not understand all the categories of illness, but I know what myasthenia gravis means, because it has some connection with my own profession. The other week I again saw a young lady who was suffering from this muscular disease. It is a wasting disease which affects the involuntary muscles, breathing, and so on. This young woman, who wanted to be a professional dancer, came to see me. Because my suspicions were aroused, I referred her elsewhere and she was found to be suffering from this disease. Her medical advisers and others sustained her over many years, enabling her to carry out her ambition to be a dancer. She is an intelligent girl. It is just conceivable that if she now goes for drugs and is exempted as suffering from this disease—and I doubt whether she knows what she is suffering from—she may go to a library, discover what it means, and thus shatter all her hopes and expectations for the future.
This is another example of the anomalies that arise in Regulations of this kind once one departs from a fundamental principle. Those who think that this is a departure will continue to fight the Minister and his colleagues. The Government have put this matter on the agenda of every trade union conference this year, when they could have been thinking about other things. As they have taken the initiative, we should take up the challenge and fight them in every way that we can.

10.53 p.m.

Mr. William Molloy: I think that most of us on this side of the House would readily acknowledge that the fundamentals of our arguments were submitted in the very able and moving speech of my hon. Friend the Member for Willesden, West (Mr. Pavitt). He paid a well deserved tribute to my hon.


Friend the Minister of Health. It was a sad occasion for us tonight to listen to a sad voice being compelled to make a Tory speech from the Front Bench of the Labour Government. It was upsetting to the Minister and it was distressing to many of us on this side of the House.
One of the golden threads of democratic Socialism has been to see the world enjoy a world national health service. Many of us sincerely believe—I certainly do—that if it had not been for the interruption of the 13 years of the party opposite we would not only have had a first-class National Health Service in this country, but it would have been of such proportions that possibly many other parts of the world would have attempted to emulate us. Many on this side were sad and disheartened that the Labour Party lost the General Election of 1951, if only for that reason. Therefore, perhaps my right hon. Friend and many of his colleagues on the Front Bench will try to understand the anguish and bitterness that many of us feel in making the speeches we have been compelled to make against the Government on this issue.
These Regulations are not merely distasteful; they are repugnant. We have to ask: was this a decision of the British Cabinet, or was it forced on them to influence someone outside? Might it be that at this late hour my right hon. Friend will create Parliamentary history by withdrawing this Order? Might I encourage him, by announcing that Mr. Cecil King has been found out and has had to give up his job. He is now redundant. This might be some encouragement to my right hon. Friend not to take any notice of others who have given him such bad advice.
The main arguments we have had have been about problems in the economy. There have been problems in the economy. What is clearly distasteful to us is that in trying to resolve the problems in the economy the Government have quite rightly looked to see who shall make the big contributions. We think that bigger contributions to assist the economy ought to come from the City, from big business, and from those who are hale and hearty. The last thing that we should try to do is to get money from those who are sick. The

paradox is that if, by some remarkable chance, in the next couple of years the people of this country are astonishingly healthy, the economy will be in a more dreadful state than it has ever been. That is the logic of these Regulations. We are concerned about whether this is the thin end of the wedge. We are concerned about where the process will end. Will we get to the position of having to say that the economy is held together by an abdominal belt? That will be about as daft a situation as one can imagine.
Hon. Gentlemen have, naturally, criticised these Regulations. They say that they will not work efficiently, and that they will not produce enough money. All their arguments about the social services are based on money. The hallmark of a true Conservative is that he knows the price of everything but the value of nothing, and that has been demonstrated this evening. I regret that that argument is now being advanced from our Front Bench.
The argument that the economic situation demands the introduction of these charges is phoney. My hon. Friend the Member for Plymouth, Sutton (Dr. Owen) put forward a suggestion which I wish Mr. Speaker had allowed us to pursue. My hon. Friend wanted the debate to be widened so that he could suggest other means of saving money. If the debate had been widened, I am sure that many of my hon. Friends would have suggested many sound suggestions about how the Government could save much more than this miserly sum and leave the Health Service alone.
We have listened to all the arguments about collecting this money. We have heard all the gruesome stories about how difficult it will be to define who is chronically sick. Will this saving really assist our economy? Aneurin Bevan used to argue that the Health Service made money by preventing people becoming seriously ill. He was, of course, talking about important people—coal miners, steel workers, transport workers, and so on.
At one time it was estimated that by reducing the incidence of bronchitis in those industries the advantage to the economy was three times the cost of the Health Service in any one year. If people have to pay a few shillings for the first and second occasions on which they need


prescriptions, they will try to avoid having to visit a doctor. What worries us is this horrible phrase about having to struggle not to visit a doctor until it is really necessary, because we know that people will put off their visits until it is too late for simple remedial action to be taken, and they will then suffer long periods of illness. The result will not only be deleterious to the individual, but, if the person concerned is one of the workers to whom I referred earlier, the loss in economic terms will far outweigh the saving envisaged by these proposals.
Many of my hon. Friends and I think that the manner in which this debate has been treated—it might have been worse if there had not been a protest—was not consonant with Parliamentary procedure or with the importance that such a debate should be accorded. We would have been prepared to debate this matter all through the day—and all through the night, to use a Welsh phrase. We wish that my right hon. Friend had responded to my request. He has a wonderful opportunity to weigh up the arguments and make Parliamentary history by agreeing that the Regulations should be annulled.
We ask the Government not to commit a crime which we expect the Tory Party to commit. The Tory Party has always loathed the National Health Service, but it was never politically expedient for the Tories to say so. The shameful thing about these Regulations is that they will destroy much of what the Labour Party has believed in in its fight to build up a great National Health Service. They will cause dissension and unhappiness within the ranks of the Labour Party. Most important of all, they will put a burden on those who can least afford to pay.
In a dark, gloomy and miserable world the National Health Service, with its free comprehensiveness, has been the only beacon of sanity to which mankind could turn. I know that the idea of a free National Health Service to alleviate suffering is a joke to the hon. Member for Bury St. Edmunds (Mr. Eldon Griffiths). I hope that there will be enough of us here tonight to ensure that these Regulations are annulled. We will not merely be annulling a Statutory Instrument and preventing the imposition of prescription charges. We will be giving encouragement to everybody who wants to see

sanity placed again on the agenda and money spent all over the world on health, food, and all the decent things of life. This is what we mean when we say that we want the Regulations annulled so that decency and sanity can take their place high on the agenda of the affairs of mankind.

11.3 p.m.

Mr. John Cronin: I am grateful to my hon. Friend the Member for Ealing, North (Mr. Molloy) for shortening his speech so that I can make a few remarks before the Undersecretary of State for Scotland speaks. I am sorry that my few remarks will have to be rather critical of my right hon. Friend the Minister of Health and his proposed prescription charges. The Minister said that he had no alternative except to make this cut in National Health Service expenditure of the choice available. This is not the argument. There was no need for any cut in the Service at all. If the Minister had resolutely declined to accept any cut and had offered to resign rather than accept a cut, the Government would not have dared to introduce these prescription charges.
These Regulations are socially unjust, economically irrelevant, and an act of grave political unwisdom. There was never any need to make this form of cut. Several forms of taxation could have been employed which would have raised much more than the amount which will be saved by this cut. An increase of 1d. in the tax on a pint of beer, or a small increase in the betting tax, would have obviated the need for this invidious and undesirable cut.
The Minister was rather coy about saying what the saving will be which justifies this political behaviour, this abandoning of Socialist principles. The Prime Minister said in January that the figure would be about £25 million, but he did not then know what the exemptions would be. Even if it is £25 million, will this relatively small sum, equivalent to about 2½ per cent. of our current and capital account balance of payments deficit last year, be worth the suffering and abandonment of principle involved? Will it really bring a gleam into the eyes of the gnomes of Zurich?
The Minister must be aware that, economically, it will not be helpful, even


from his limited point of view, because much of the saving will be offset by bulk prescribing by doctors. People will also indulge in self-medication. This will result in the same amount of money being spent on Pharmaceuticals and diverted from exports.
This order is a gross social injustice. Many hon. Members have pointed out that it is totally unfair to tax the sick.
This charge will particularly affect low wage-earners, agricultural employees and others who receive perhaps £15 a week. Such a man with a wife and family might spend £1 or more a week in prescription charges if several of his children are ill. [HON. MEMBERS: "They are exempt."] My remarks apply to older members of his family. This is a particularly harsh form of discriminatory taxation. My hon. Friends have taken pride in opposing taxes which bear harshly on those who are least able to afford them. When we were in opposition we opposed all proposed Purchase Tax and other increases which hit the less well off. Now we are introducing what is, in effect, a poll tax on an unfortunate section of the community, the sick, at the time when they most need our sympathy and help.
This imposition is unwise politically. The Government have repeatedly performed acts which have alienated Labour supporters. This is one of the gravest. Whatever the result of tonight's vote, this policy is opposed by the majority of my hon. Friends, and the same can be said with even more force about active Labour supporters outside. We are doing ourselves great political harm for a narrow, limited and doubtful economic objective.
Most of my hon. Friends will not accept this situation. We will continue to fight it and press for these charges to be withdrawn. Although the damage has been done and the image of the party has been besmirched, the majority of us will continue to oppose these prescription charges. We will ensure that ultimately justice is done to the sick.

11.9 p.m.

The Under-Secretary of State for Scotland (Mr. Bruce Millan): I naturally understand the feelings that some of my hon. Friends have expressed, and many of their criticisms. With many of them

I have a good deal of sympathy, as has my right hon. Friend, which will be clear from his remarks. None of my hon. Friends and no Member of the Government has looked forward to this debate or took the decision to reimpose prescription charges except with the strongest feelings of regret. We have to place this decision in the context of the economic situation in which it was taken.
I do not think that this is precisely the time to argue all the facts of the economic situation, but it is generally accepted in all parts of the House that the Government in January had very many unpleasant decisions to take, but decisions which were absolutely essential if we were to put our economy on its feet. My right hon. Friend has pointed out that in those circumstances it was inevitably necessary that certain reductions should be made, not in the absolute limits of social service expenditure but in the increases which it had otherwise been intended should take place.
Despite what my hon. Friends have said this evening, it is unrealistic to expect that when reductions were being made elsewhere that the Health Sendee could be completely excluded from consideration. [HON. MEMBERS: "Why not? "] The decision that had to be made was to reduce the expenditure in a way that we felt would be least damaging to the fabric of the National Health Service as a whole.
This naturally involves questions of priority, and I ask my hon. Friends to believe that, despite some of the facile assumptions some of them have made this evening, it is quite necessary in this kind of situation to have some regard to priorities, and therefore the kind of statement that was made, for example, by my hon. Friend the Member for Plymouth (Dr. David Owen), very accurately described the kind of considerations which the Government had to have in mind.
There was, for example, the possibility of a decision to cut the hospital building programme, or one might have taken some other decision within the National Health Service to make other reductions in its expenditure. But all such reductions were very much more unpleasant than our decision to reimpose the prescription charges.

Mr. Pavitt: Can I assure my hon. Friend that all the factors he has mention have been taken into consideration by the North-West Metropolitan Regional Hospital Board, of which I am a member?

Mr. Millan: Then I am surprised that my hon. Friends should have reached the decision they took, because a cut in the hospital building programme and hospital expansion generally of the same amount as is to be produced by the re-imposition of the prescription charges would very seriously damage the Health Service at the present time.
It is also worth pointing out, because my hon. Friend the Member for Willes-den, West (Mr. Pavitt) made the point, that while in any situation one has a choice between reducing expenditure or increasing taxation, in my right hon. Friend's Budget there have been very substantial increases in taxation. It seems to me to be slightly overlooking some of the important facts of the situation to suggest that the Government did not take into account the possibility of taxation increases when, in the Budget a month or so ago, we had these very substantial increases in taxation.
In that situation, regrettable as it may appear to my hon. Friends, as it is to members of the Government, the decision was reached that reimposition of prescription charges was the least damaging step that could be taken in respect of the National Health Service. For those of my hon. Friends who look on this in absolute terms, and are not willing even to discuss whether in any such situation prescription charges might be levied, the rest of what I have to say will be rather irrelevant to the major consideration. I wish to address the rest of my remarks to those who take a more realistic view of the choices before the Government in January.
Having decided to reimpose prescription charges, the main consideration in the detailed study which the Government gave to this subject was the avoidance of hardship. In this respect, I want to draw some distinctions between this scheme and that which was imposed and carried on by right hon. Gentlemen opposite. One of the major objections to the previous Government's scheme was

that it involved a system of refunds. In other words, the patients had to pay the charge and then go through a rather elaborate procedure for getting the money back. We decided that the system which we introduced would be based on exemptions rather than refunds.
It has, therefore, taken us rather longer to work out the details of the scheme, but we think that that delay in the introduction of the scheme is worth while, because it has enabled us to lay down in these Regulations not refund provisions, although these may be necessary for a minority of cases, but exemption provisions for the vast majority to whom we wish to give special attention. These are the people who are to be exempt on grounds of age, under 15 or over 65, the chronic sick, the war disabled, those on supplementary benefit and also, of course, those who are not on supplementary benefit but who are among the lowest income earners.
It is an indication of the difference between this scheme and the scheme of the previous Government that under their scheme refunds were just over 10 per cent. of the total number of prescriptions, whereas under this scheme 50 per cent. of prescriptions will not bear the charge, representing categories of exempt patients running at about 42, or 43, or 44 per cent. In these circumstances, it is extraordinary that the hon. Member for Cheadle (Dr. Winstanley), for example, should have said that he preferred the Tory scheme. The Tory scheme provided refunds for about 10 per cent. of prescriptions, whereas the present scheme will provide for exemptions for about 50 per cent. of prescriptions.

Dr. Winstanley: I never suggested that I preferred the Tory scheme. I said that it was more honest and more straightforward and more intelligible. I said that I was opposed to charges. I did not say that I preferred that scheme; I said merely that it was more honest.

Mr. Millan: It is still an extraordinary comment if the hon. Gentleman does not believe in charges.
Some of my hon. Friends rightly asked—and I can understand their feelings—what the effect of the scheme would be on the attitude of patients towards going to the doctor, particularly patients in poorer circumstances. We


know from experience that, particularly in the early period of the reimposition of charges, the number of prescriptions goes down appreciably, but that reduction is strictly temporary. However, obviously, one would not want any scheme to have the effect that people who needed medication would be prevented from going, or made reluctant to go, to their doctors. But my hon. Friends who have made that point completely overlook the range of exemptions involved in the scheme.
For example, they cover the lower-paid workers, who are able to apply to the Ministry of Social Security for a refund, in the same way as those on supplementary benefit. Therefore, I do not believe that there would be large numbers of people, particularly in view of these exemption categories, who will be prevented from going to doctors or who will be reluctant to go to their doctors because of the introduction of prescription charges. I do not believe that that happened in the past to the extent that some may have believed, and I am sure that it will not happen under the scheme we are discussing.

Mr. Lomas: Would my hon. Fnend stop being an apologist for Tory policies? He should have some regard for our concept of a Health Service free for all at the time of need. May I inform him that 1 had intended tonight to abstain. In view of his comments and the speech of the Minister of Health, I intend to vote against the Government.

Mr. Millan: That is no doubt very regrettable, but hon. Members must listen to some of these facts about the Regulations and perhaps not approach this matter with the closed mind that some of my hon. Friends have demonstrated this evening.

Mr. Andrew Faulds: You are going to lose some more votes.

Mr. Millan: One of the characteristics of the closed mind is an inability to listen to arguments with which one does not agree. This has been demonstrated on more than one occasion tonight.
There have been a number of criticisms about the complexity of the Regulations. But they inevitably must be

complex if we are to provide for these categories of exemption. Most of the arguments we have heard tonight, far from asking for further simplification of the Regulations—for example, the argument for extending the categories of exemption—are arguments for making the Regulations even more complex. But the Regulations inevitably must be complex when we are trying to provide for this wide variety of exemptions which I have described. But I do not think that that vitiates the calculations of the savings we have announced on the re-introduction of charges.
I could not understand the remark of my hon. Friend the Member for Willes-den, West that the Government had been coy about quoting the savings. The figure was announced at £25 million in the original announcement in January, and the savings are calculated now at the same figure.
May I say something about the age limits. There is no magic about the age limit of 15. It would have been perfectly possible and arguable to fix another age limit, perhaps 14 or 16, for children. But the age chosen seems to me to represent the exemption of very large numbers of children, which is surely what my hon. Friends want.
A similar situation exists concerning a number of other categories. It was asked, for example, why the industrially disabled should not be covered in the exemption categories. One could perhaps draw a different line, but many industrially disabled people do not require prescriptions to any greater extent than many other people. There is no particular relationship between industrial disablement and the number of prescriptions. In any case, the industrially disabled, as with a number of other categories which have been mentioned, will gain advantage from the single payment scheme which is coming later this year.
My right hon. Friend explained what considerations the Government had in mind in denning the categories of chronic sick. He told of the discussions we have had with the medical profession, and the doctors' understandable reluctance to be concerned in a definition of chronic sick that would mean making judgments which, medically


speaking, are very difficult and might have involved them in invidious comparisons between one patient and another.
Therefore, the list in the Regulations at present defining the chronic sick is inevitably restricted, that is a list of conditions which can be defined with some precision. There are a number of other illnesses and conditions which it is arguable should be included in the definitions, such as tuberculosis, schizophrenia and other forms of psychiatric illness, pneumoconiosis and silicosis. A number of others were also mentioned in the debate.
The difficulties of which my right hon. Friend spoke apply in one measure or another to all the conditions mentioned. Relevant here is the single payment scheme—the season ticket system, to use rather an unfortunate term—which my right hon. Friend announced would be introduced later this year when we have the statutory power to do so under a new Clause in the Health Services and Public Health Bill. All the categories mentioned can take advantage of the single payment scheme, about which there seems to have been some misunderstanding. More than one hon. Member asked whether all illnesses would be eligible for the single payment or season ticket system. There is no eligibility. Any patient will be able to apply for the season ticket once the scheme is introduced. Therefore, most of the marginal difficulties which my hon. Friends have mentioned tonight will be taken care of in the scheme.

Dame Joan Vickers: Will the hon. Gentleman say something about the different age of 60 and 65? This is very important.

Mr. Millan: There is no evidence that women between the ages of 60 and 65 require more prescriptions than men of the same age. There is no particular magic age of 60 or 65 for women.

Mrs. Lena Jeger: Has my hon. Friend noticed that the time is going on?

Mr. Millan: Yes, I have noticed that. I was about to say that I have taken up some of the detailed points made tonight. But the basic decision that must be made, at least on this side of the House, is whether in the circumstances we faced in January our action was right. The details of the scheme are very important, but it is on that basic decision that we shall be voting this evening.

Mr. Pavitt: I beg to move, That the Question be now put.

Mr. Deputy Speaker (Mr. Sydney Irving): I cannot accept that Motion.

Mr. Millan: I was about to say that I have explained the background and the necessity for the decision. It was regrettable but one which we felt was necessary in the circumstances, and I ask the House to support us.

Question put.

The House divided: Ayes 52, Noes 129.

Division No. 207.] 
AYES
[11.30 p.m.


Allaun, Frank (Salford, E.)
Gregory. Arnold
Park, Trevor


Atkinson, Norman (Tottenham)
Criffiihs, Will (Exchange)
Parkyn, Brian (Bedford) 


Barnett, Joel
Hughes, Emrys (Ayrshire, S.)
Perry, George H. (Nottingham, S.)


Bidweli, Sydney
Jeger,Mrs.Lena(H'b'n&amp;St.P'cras,S.)
Roberts, Gwilym (Bedfordshire, S.)


Booth, Albert
Jenkins, Hugh (Putney)
Rowlands, E. (Cardiff, N.)


Brown, Hugh D. (G'gow, Provan)
Johnston, Russett (Inverness)
Ryan, John 


Butler, Herbert (Hackney, C.)
Kerr, Mrs. Anne (R'ter &amp;Chatham)
Sheldon, Robert 


Cronin, John
Kerr, Russell (Fettham)
Short,Mrs.Renée (W'hampton,N.E.


Dickens, James
Lee, John (Reading)
Swain, Thomas


Dobson, Ray
Lestor, Miss Joan
Thorpe, Rt. Hn. Jeremy


Driberg, Tom
Lomas, Kenneth
Whitaker, Ben 


Dunwoody, Dr. John (F'th &amp; C'b'e)
Lubbock, Eric
Wirmick, David


Ellis, John
Mendelson, J. J.
Winstanley Dr. M. P.


Evans, Cwynfor (C'marthen)
Mikardo, Ian
Yates Victor


Faulds, Andrew
Molloy, William
mt


Fletcher, Ted (Darlington)
Newens, Stan
TELLERS FOR THE AYES:


Foot, Rt. Hn. Sir Dingle (Ipswich)
Norwood, Christopher
Mr. Laurence Pavitt and


Foot, Michael (Ebbw Vale)
Orbach, Maurice
Mr. Frank Hooley.


Galpem, Sir Myer
Orme, Stanley





NOES


Albu, Austen
Harrison, Walter (Wakefield)
Parker, John (Dagenham)


Anderson, Donald
Hart, Rt. Hn. Judith
Peart, Rt. Hn. Fred


Archer, Peter
Hazell, Bert
Pentland, Norman


Armstrong, Ernest
Healey, Rt. Hn. Denis
Perry, Ernest G. (Battertea, S.)


Benn, Rt. Hn. Anthony Wedgwood
Hilton, W. S.
Prentice, Rt. Hn. R. E.


Bishop, E. S.
Houghton, Rt. Hn. Douglas
Rees, Merlyn


Blackburn, F.
Howell, Denis (Small Heath)
Reynolds, G. W.


Boyden, James
Howie, W.
Richard, Ivor


Braddock, Mrs. E. M.
Hughes, Rt. Hn. Cledwyn (Anglesey)
Roberts, Goronwy (Caernarvon)


Bray, Dr. Jeremy
Irvine, Sir Arthur (Edge Hill)
Robinson,Rt.Hn.Kenneth(St.P'c'as)


Broughton, Dr. A. D. D.
Janner, Sir Barnett
Robinson, W. O. J. (Walth'stow, E.)


Brown, Rt. Hn. George (Belper)
Jenkins, Rt. Hn. Roy (Stechford)
Rodgers, William (Stockton)


Brown,Bob(N'c'tle-upon-Tyne,W.)
Johnson, James (K'ston-on-Hull W.)
Roebuck, Roy


Brown, R. W. (Shoreditch &amp; F'bury)
Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)
Ross, Rt. Hn. William


Buchan, Norman
Judd, Frank
Shore, Rt. Hn. Peter (Stepney)


Callaghan, Rt. Hn. James
Lawson, George
Short,Rt.Hn.Edward(N'c'tle-u-Tyne)


Carmichael, Neil
Ledger, Ron
Silkin, Rt. Hn. John (Deptford)



Castle, Rt. Hn. Barbara
Lee, Rt. Hn. Frederick (Newton)
Silkin, Hn. S. c. (Dulwich)


Chapman, Donald
Lever, Harold (Cheetham)
Skeffington, Arthur


Concannon, J. D.
Loughlin, Charles
Slater, Joseph


Crosland, Rt. Hn. Anthony
Lyon, Alexander W. (York)
Small, William


Crossman, Rt. Hn. Richard
McCann, John
Snow, Julian


Dalyell, Tarn
MacColl, James
Stewart, Rt. Hn. Michael


Davidson, Arthur (Accrington)
Mackie, John
Stonehouse, John


Davies, Dr. Ernest (stretford)
Mallalieu,J.P.W.(Hudder&amp;field,E.)
Swingler, Stephen


Davies, Harold (Leek)
Marsh, Rt. Hn. Richard
Taverne, Dick


Davies, Ifor (Gower)
Mason, Rt. Hn. Roy
Thomas,Rt.Hn.George(Cardiff,W.)


Dell, Edmund
Mellish, Rt. Hn. Robert
Thomson, Rt. Hn. George


Diamond, Rt. Hn. John
Millan, Bruce
Tinn, James


Dunnett, Jack
Mitchell, R. C. (S'th'pton, Test)
Urwin, T. W.


Dunwoody, Mrs. Gwyneth (Exeter)
Moonman, Eric
Varley, Eric G.


Ennals, David
Morgan, Elystan (Cardiganshire)
Walker, Harold (Doncaster)


Evans, loan L. (B'rm'h'm, Yardley)
Morris, Charles R. (Openshaw)
Wallace, George


Fitch, Alan (Wigan)
Morris, John (Aberavon)
Wellbeloved, James


Foley, Maurice
Moyle, Roland
White, Mrs. Eirene


Forrester, John
Murray, Albert
Whitlock, William


Fowler, Gerry
Noel-Baker, Rt.Hn.Philip(Derby,S.)
Williams, Alan (Swansea, W.)


Freeson, Reginald
Oakes, Gordon
Williams, Alan Lee (Hornchurch)


Gray, Dr. Hugh (Yarmouth)
Ogden, Eric
Williams, Mrs. Shirley (Hitchin)


Greenwood, Rt. Hn. Anthony
O'Malley, Brian
Wilson, Rt. Hn. Harold (Huyton)


Grey, Charles (Durham)
Oram, Albert E.



Griffiths, Rt. Hn. James (Llanelly)
 Oswald, Thomas
TELLERS FOR THE NOES:


Gunter, Rt. Hn. R. J.
Owen, Dr. David (Plymouth, S'tn)
Mr. Neil McBride and


Hamling, William
Pannell, Rt. Hn. Charles
Mr. Joseph Harper.


Hannan, William

Orders of the Day — BARBADOS (GIFT OF A PARLIAMENTARY LIBRARY)

The Lord Privy Seal and Leader of the House of Commons (Mr. Fred Peart): I beg to move,
That Mr. R. W. Elliott, Dr. Miller and Mr. John Robertson have leave of absence to present, on behalf of this House, a Parliamentary Library to the House of Assembly of Barbados.
The House will recall that on Tuesday, 21st May, it approved of the presentation of an independence gift to Barbados. The Motion today, if approved, gives leave of absence to a small delegation to present the gift on our behalf. The House may wish to know that the composition of the delegation has been arranged, and that Mr. Barclay, a Clerk of the House, will accompany it.

Question put and agreed to.

Orders of the Day — COLLIERY CLOSURES

Motion made, and Question proposed, That this House do now adjourn.—[Mr. McBride.]

11.40 p.m.

Mr. David Watkins: For several weeks I have been seeking the opportunity of an Adjournment debate, and I am particularly grateful that this evening I am able to discuss housing problems in areas of colliery closures.
The National Coal Board is the owner of thousands of houses, most of which it inherited from colliery owners of pre-nationalisation days who were past masters in the art of exploiting the tied cottage system.
The matter which I particularly wish to raise concerns the position of miners who, by virtue of their employment with the Board, are the tenants of these houses, and who become redundant when the pits at which they work close. This


is very much a growing problem, as the programme of colliery closures is put into operation.
When a miner becomes redundant he is known as a licensee of his house, rather than the tenant of it. This means that for six months he pays a nominal rent for his house, which may be anything from 10s. to 15s. a week. After the six months' period he has to pay the market rent. Perhaps I might give the House an example of what this means by quoting the case of a constituent of mine who has recently become redundant. For the first six months he will pay 17s. 2d. a week in rent. In November, when the six months' period expires, his rent will become £2 6s. Id. a week.
In the North-East of England, which is the coalfield area with which I am particularly associated, the Board allows its emptoyees to live rent free in its houses. I think that I am right in saying that this practice is peculiar to that area, and that in other coalfield areas other systems operate for the payment of rents.
The North-East is faced with large-scale colliery closures. It falls singularly hard on a family if a miner who has lived in a rent free house for the whole of his married life loses his job and has to pay rent for it. Not all licensees of the Board's houses have recently become redundant. Many have been redundant for several months. In fact, in some cases the months are running into years. Starting from 25th May, all licensees' rents are being increased by the Board. It is difficult to quote a typical case, because there is a wide variation among houses.
On making fairly extensive investigations, I have found that often different rents are charged and different rises are applied to very similar houses. In so far as I have been able to check up in and around my constituency, that increase seems mostly to vary from between 3s. 6d. and 6s. a week, although one of my constituents has told me that his rent is being increased by 13s. 8d., from £1 5s. 7d. a week to £1 19s. 3d.
There is a widespread feeling of resentment among licensees about the imposition of these increases, particularly as they are being imposed in what is supposed to be a time of restraint in wages

and prices. I repeat that it falls hardest upon those who become redundant and who, at the same time, have to pay rent. This is the problem as it presents itself to those living in the houses.
I turn now to the Board's side of the problem. I have made extensive inquiries of the Board, both at Hobart House in London and at area headquarters in the North-East. I pay tribute to the extreme courtesy and helpfulness with which I have been received at all levels by the officials of the Board. I am satisfied that the Board has acted with impeccable correctness in assessing and applying these rents. I have no doubt that the increases and the levels of the new rents are strictly in accordance with the law as laid down by the Rent Acts. I do not believe that any of these rents would be likely to be challenged by the county rent officers.
In maintaining these houses, the Board is compelled to run large maintenance departments. With all the commercial pressures upon it, and with all the costs of maintaining these houses, the Board is obviously compelled to charge something in the nature of economic rents. I believe that these houses are a growing liability for the Board. In about three years' time, when scores of collieries will have closed, the Board will have become, certainly in large areas of the North-East and in other parts of the traditional coalfields, an absentee landlord which will own thousands of houses in an area where it will have no industrial interest.
I come to the long-term problems which arise. Many of the houses are very old. By modern standards they are very unsatisfactory. There are rows of ugly back-to-back houses with virtually no amenities, judging amenity value by any modern standard. Most of the houses are small, with poky little rooms and with outside lavatories. Many are affected by damp and subsidence. Considering the standards being provided, the economic rents for these houses appear to be high.
In the long-term, there is urgent need to replace these old and unsatisfactory houses with modern and better homes. But the nature of the ownership of this property seems to make this impossible. The N.C.B. would no doubt be glad to be rid of these houses, but the local authorities can hardly be saddled with them, bearing in mind their age and the


financial complications involved. Virtually nobody wants them. The N.CB. and local authorities do not want them and, if better homes are available, the people living in them do not want them as long-term dwellings.
Although I have posed these problems, I have not attempted to give the answers, mainly because I do not pretend to know them. Nor do I expect the Parliamentary Secretary to provide answers to problems that are so massive that they cannot be solved locally in the coalfield areas because there are not sufficient financial resources in the localities to tackle the difficulties of urban renewal and the replacement of these houses with modern dwellings at reasonable prices.
The N.C.B., with its difficulties and commercial pressures, cannot reasonably be expected to subsidise the houses or their replacement. The resources of the local authorities in the areas would be severely strained if they had this problem placed on them. It will, therefore, require a national effort for the urban renewal of these areas.
I hope that, by raising these matters, thinking on the subject will be initiated in the appropriate quarters about the nature of the problems involved. For those who are facing rent increases, these are immediate problems. For the nation as a whole, the problems of housing in areas of colliery closure are growing steadily.

11.59 p.m.

The Parliamentary Secretary to the Ministry of Power (Mr. Reginald Free-son): I appreciate the spirit in which my hon. Friend the Member for Consett (Mr. David Watkins) has raised this difficult subject, and for the way in which he virtually commended the National Coal Board for the manner in which it has been handling what is a complicated problem involving some people in a generally difficult situation of redundancy. The best thing for me to do is to state the factual position, as we in the Ministry have ascertained it from the Board, and then to set the position out in regard to the policy of the Government and the Board against the background of the facts.
I want to assure my hon. Friend and any person on whose behalf he may be

speaking that we realise the kind of anxieties that face people in this changing situation in the industry. This is one of the many kinds of anxiety with which we have to deal in a contracting and reshaping coal industry.
I said that I would start with a factual summary of the position regarding N.CB. houses. As my hon. Friend said, the coal industry has been providing houses for its workers for many years-it goes back well beyond vesting day, and there is a range of background histories to these housing schemes in different parts of the country. There are today 95,000 houses "vested" in the Board, and 24,000 dwellings which are run by the Coal Industry Housing Association. Many of these are of more recent date. In other words, a total of about 119,000 houses is involved.
About 51,500 houses, including 44,000 vested houses, are "controlled" under the 1957 Rent Act, 39,500 houses —including 23,000 vested nouses—are "regulated" under the 1965 Rent Act, and 28,000 vested houses are rent free, or charged at concessionary figures. These are mainly in Northumberland and Durham, and fall outside the Rent Acts. Of the 119,000 houses, about 80,000 are occupied by workers still in the industry, 32,000 are occupied by retired or incapacitated men, or by widows, and 7,000 are occupied by people who are no longer in the industry.
Houses controlled under the 1957 Rent Act are those which in England and Wales had a rateable value on 7th November, 1956 of less than £30 a year. Their rent ceiling is laid down by Statute at a top range of two and one-third times the gross value if the owner is responsible for all repairs and decoration. Under the 1965 Rent Act, rents of houses with a rateable value on 23rd March, 1965, of up to £200 can be fixed by a rent officer or a rent assessment committee.
Houses occupied under service licence are made available by service agreements with the Board—what in other circumstances are referred to as tied cottage arrangements. These occupiers have no protection as to rent or security under the Rent Acts.
I turn now to the Board's policy. As regards vested houses which were decontrolled by the 1956 Act, the Board


requires tenants who are employees, retired employees or widows to pay less than the regulated fair rents recommended by the local rent officer. In a typical case about which we have been able to learn from the Board, a fair rent of 62s. weekly, exclusive of rates, has been fixed, while the tenant until recently has paid 34s. a week. Now, as a result of a recent increase, to which my hon. Friend referred, the rent will be 43s. 3d. There is bound to be some variation between the examples given over such a wide range, but not a great deal.
For the Housing Association houses to which I have referred, where the rent is not controlled by the 1957 Act, rents of employees, retired employees and widows are kept in line with local council estates, which are normally below the fair rents under the 1965 Rent Act. In a typical case, a fair rent of 74s. weekly exclusive of rates has been fixed, while the tenant until recently has been paying 45s. 11d. In this case, the increase which the Board proposes will bring the figure to 57s. 11d.
My hon. Friend referred to the decision that redundant miners should pay nominal rent for six months and that then it should rise to what he described as market rent. The position as I understand it is that tenants of either vested or Housing Association houses decontrolled under the 1957 Act, who wish to work in the industry, including people who have been made redundant, are normally required by the Board to pay the increased rent, but within the limit of the fair rent level. I appreciate that as between zero, or a small concessionary rent, and something even within the fair rent level, there can be quite an increase.
Licensed occupation is rather different and the Board's normal rent policy does not operate in this respect. There is a long tradition in Northumberland and Durham that serving mineworkers should be provided with a house rent free, but that retired employees and widows should pay a small rent. The Board also makes certain concessions to people over 60 who are made redundant.
Under the 1965 Rent Act, it is possible for the Board to convert licensed occupation into a tenancy by applying for a certificate of fair rent. As a matter of

policy, the Board intends to convert the status of houses no longer needed for employees, but to keep the status of those which it still needs. I understand that about 4,000 applications will go before the Durham rent officer for certificates of fair rent.
The grant of a certificate creates a regulated tenancy, and thereby rent may be charged for the first time. The certificate of fair rent procedure does not permit a service licensee to make representations to the rent officer about the level of rent fixed, but by this procedure security of tenure is obtained for the first time under the Rent Acts. I believe that my hon. Friend will accept this as something much better than has happened in many instances when tied cottages have remained uncovered by the Rent Acts and when the tenants can be put out even under the present law.
It is evident, from what he has said, that my hon. Friend's interest lies mainly with licensed properties. In the North Durham area, the Board owns 10,000 such properties. Of these 5,000 are occupied by employees, 4,500 by retired employees and widows, and 500 by persons no longer in the industry. Being vested houses, and in many cases the subject of very long-standing agreements with the unions, most of these are old houses, but they are provided free to men working in the pits.
We must recognise from the figures which I have given that the Board is not only an employer, but also a landlord on a very large scale, with the problems which that entails. Declining manpower, therefore, poses a major problem for the Board as a landlord, as the percentage of houses no longer occupied by active mineworkers is rapidly increasing, and in many instances the Board is left with rapidly ageing property on its hands.
The Board is faced with the implications of charging what, in effect, are concessionary rents to a large number of people who have left the industry. When a person voluntarily leaves to take up other employment, the problem is not so acute, but, undoubtedly, as I accept and as the Board accepts, there are prob-blems both for the Board as employer and for the men when they are made redundant before normal retiring age.
I understand that the Board is in close touch with the unions on the whole subject of rents and costs of occupation of the Board's houses. This is a very delicate and complex matter as many of the agreements go back many years. As consultations and negotiations are now going on, it would not be proper for me on the Floor of the House to make any comment on what is essentially a matter of conditions and terms of employment. However, I am sure that, as far as possible, the Board and the unions will find arrangements which are as satisfactory as possible to all sides.
However, I ought to make the Government's position clear by stating four points. First, the Ministry of Social Security takes fully into account the level of rent payable by an unemployed person if a claim for supplementary allowance is made under the Ministry of Social Security Act. Secondly, the draft Redundant Mineworkers (Payments Scheme) Order, which was laid before the House on 21st May, and which comes before the House for debate shortly after the Recess—and my hon. Friend's chief concern is with redundant miners—provides that in certain circumstances an allowance may be payable for elderly mine-workers eligible under the redundancy scheme for increased accommodation costs for Board's houses in which they continue to live.
Thirdly, the Board, like any other landlord, is subject to the statutory controls of the Rent Acts. Fourthly and finally, the Board will be equally subject to Government policy, which we recently announced in the House, as it is reflected

in the Prices and Incomes Bill now going through Parliament.
I conclude by referring to the general problem which my hon. Friend rightly mentioned—the problem of urban renewal. This is not a matter for the Ministry of Power, nor is it directly a matter for the Coal Board, which is a landlord by virtue of its being an employer in a particular industry. But there are big issues for the area which my hon. Friend represents and for surrounding areas. Bearing in mind the excellent White Paper on Government policy published by my right hon. Friend the Minister of Housing and Local Government recently, "Old Houses into New Homes", it might well be worth while entering into discussions with my right hon. Friend in that Department on this general question as well as contacting local authorities, because it is in that direction rather than in the field of the Ministry of Power that problems concerning improvement areas, urban renewal areas, and redevelopment can be best dealt with, particularly as legislation will be introduced by the Minister of Housing and Local Government, at not too distant a time. from now, to implement the White Paper proposals to deal with old districts in big city areas.
I hope that my hon. Friend will accept my general assurance that this matter will be treated as sympathetically as pos sible and that we as a Department will keep in touch with it and be as helpful as possible.

Question put and agreed to.

Adjourned accordingly at seven minutes past Twelve o'clock.